Swipe Fee Reform Hits Roadblocks
June 21, 2010
The Durbin amendment, language contained in the Senate’s version of sweeping financial reform legislation that would limit swipe fees on debit transactions, lost some momentum last week under pressure from financial services lobbyists. In addition to Sen. Richard Durbin (D-Ill.)—the amendment’s author—indicating in a hearing that certain types of payment cards may be exempted from the final legislation, potentially more troubling to merchants hoping to reduce the burden created by interchange is a letter sent to the conference committee reconciling House and Senate version of financial reform. The letter, sent by U.S. Reps Debbie Wasserman Schultz (D-Fla.) and Kenny Marchant (R-Texas), was signed by 131 members of the the U.S. House of Representatives and asks the conferees to excise swipe fee reform from the final reform legislation. The letter cite the “unintended consequences” that could arise from the language and claims “our constituents will pay more for basic banking products and credit cards and no longer receive valuable services like fraud and identity theft protection paid for by the current interchange system.” The Durbin amendment was not addressed by the House in its reform package and the conferees continue to meet to decide if the language, among other issues, will remain in the bill.