Small Businesses, Consumers Benefit as Finance Reform Turns Five
WASHINGTON, D.C. — Five years after the Dodd-Frank financial reform became law, debit-card fees are more competitive and fairer for small merchants and consumers.
Citing a study by economist Robert J. Shapiro, the Merchants Payment Coalition said debit swipe fee reform has saved consumers almost $6 billion each year since it went into effect and supported 37,500 jobs a year as well.
"Without reform, price fixing of debit card swipe fees would still be unchecked," said Mallory Duncan, chairman of the coalition's massive group of members and senior vice president and general counsel of the National Retail Federation. "Debit reform brought some rationality to a system that made card fees merchants' fastest-growing expense."
Five years ago, Congress required the Federal Reserve to limit how much price-fixing card companies can do for their banks. The bipartisan change was led by Sen. Richard Durbin (D-Ill).
Debit reform only applies to financial institutions with $10 billion or more in assets, which accounts for only a handful of credit unions and banks. Smaller institutions are free to charge the old, higher fees, the Merchants Payment Coalition said.
"The big banks have been feigning concern about small banks and consumers for years to defend their indefensibly high swipe fees," said Lyle Beckwith, senior vice president, government relations at NACS, the Association for Convenience & Fuel Retailing. "But the facts simply don't support their contentions."