Speedway to Deliver 1.7M Signatures Supporting Swipe Fee Reform
WASHINGTON -- Representatives from Speedway and SuperAmerica (SSA) convenience stores, both subsidiaries of Marathon Oil Corp., will deliver a new set of nearly 1.7 million customer petitions asking Congress to enact swipe fee reform to benefit merchants and consumers during a press conference at 10 a.m. EST today.
The 1.68 million signatures -- collected by SSA stores in Indiana, Illinois, Kentucky, Michigan, Minnesota, Ohio, South Dakota, West Virginia and Wisconsin -- bring the total number of swipe fee petition signatures gathered across the country to 5.5 million, according to the Merchants Payments Coalition (MPC).
Expected to attend the press conference are Tony Kenney, president of SSA; Charlie Runyon, regional director for SSA; and Lyle Beckwith, vice president of NACS -- the Association of Convenience and Petroleum Retailing.
Financial reform legislation has cleared the Senate with a bipartisan provision to reform credit and debit card swipe fees, and merchant groups supporting the petition drive are asking the House and members of Congress to keep the swipe fee amendment unchanged and intact, the MPC stated.
Meanwhile, state treasurers may become an ally of the banking industry in the fight over interchange fee reform, according to a report by The Washington Post. Treasurers from at least eight states are considering sending a letter to lawmakers, expressing concerns that proposed limits on swipe fees could endanger state programs that use prepaid cards to dispense benefits such as unemployment insurance.
Nebraska's state treasurer, Shane Osborn (R), voiced his worries to Congress last week.
"The cost savings achieved as a result of moving from check to electronic distribution of benefits are significant to states and their taxpayers," Osborn wrote in a document cited by the Post. The "amendment will drastically alter this equation."
Card issuers provide prepaid cards to governments for little or no cost, relying on interchange fees to fund the program. As a result, states save money on printing and mailing checks, and the labor costs of processing and managing the accounts, the report stated.
Osborn said in the report that limiting swipe fees could force governments to pick up the tab. Nebraska adopted the cards in 2004, and currently uses them to distribute unemployment insurance, child support and wages for state employees who do not use direct deposit, according to the report. Osborn said the state previously spent roughly 60 cents to print and mail each check, and now pays 1.5 cents to load money onto the cards, translating into hundreds of thousands of dollars in savings.
"All of the liability is placed on the bank," he said. "It's a great way to do this efficiently and lower the cost."
Osborn detailed 46 additional states that use prepaid cards to distribute some sort of government benefits. The U.S. Treasury, meanwhile, began using prepaid cards to deliver Social Security payments to people without banking accounts two years ago, which it said could cut costs by up to $44 million annually, the newspaper reported.
Government programs are also an important market for card issuers. An analysis by research firm Mercator Advisory Group tagged the sector at $69 billion in 2008, or more than a quarter of the total $247.6 billion market for prepaid cards. The government accounts segment is also rapidly growing, with the use of unemployment-benefits cards alone up 111 percent in 2008, the report noted.
Tim Sloane, director of prepaid card services for Mercator, said in the report it remains unclear what would happen if the amendment were to remain in the legislation, but issuers would be determined to recoup the revenue.
"It's clear that it's enough money that it can't be compensated by the issuers saying, 'Oh, well,' " he told the Post.
Critics also argued that the amendment allows retailers to set minimum spending requirements, which may result in retailers turning away customers who use government prepaid cards for small purchases. Those people would then be required to buy additional items to hit the threshold, or use another form of payment.
"These government cards are filling a dramatic need that no other product has done before," Kirsten Trusko, executive director of the Network Branded Prepaid Card Association, a trade group, said in the report.
Related News:
Speedway SuperAmerica Fights Swipe Fees With Petition
Vermont Passes Law to Limits Swipe Fees
Senate Votes to Include Swipe Fee Reform in Financial Regulatory Bill
The 1.68 million signatures -- collected by SSA stores in Indiana, Illinois, Kentucky, Michigan, Minnesota, Ohio, South Dakota, West Virginia and Wisconsin -- bring the total number of swipe fee petition signatures gathered across the country to 5.5 million, according to the Merchants Payments Coalition (MPC).
Expected to attend the press conference are Tony Kenney, president of SSA; Charlie Runyon, regional director for SSA; and Lyle Beckwith, vice president of NACS -- the Association of Convenience and Petroleum Retailing.
Financial reform legislation has cleared the Senate with a bipartisan provision to reform credit and debit card swipe fees, and merchant groups supporting the petition drive are asking the House and members of Congress to keep the swipe fee amendment unchanged and intact, the MPC stated.
Meanwhile, state treasurers may become an ally of the banking industry in the fight over interchange fee reform, according to a report by The Washington Post. Treasurers from at least eight states are considering sending a letter to lawmakers, expressing concerns that proposed limits on swipe fees could endanger state programs that use prepaid cards to dispense benefits such as unemployment insurance.
Nebraska's state treasurer, Shane Osborn (R), voiced his worries to Congress last week.
"The cost savings achieved as a result of moving from check to electronic distribution of benefits are significant to states and their taxpayers," Osborn wrote in a document cited by the Post. The "amendment will drastically alter this equation."
Card issuers provide prepaid cards to governments for little or no cost, relying on interchange fees to fund the program. As a result, states save money on printing and mailing checks, and the labor costs of processing and managing the accounts, the report stated.
Osborn said in the report that limiting swipe fees could force governments to pick up the tab. Nebraska adopted the cards in 2004, and currently uses them to distribute unemployment insurance, child support and wages for state employees who do not use direct deposit, according to the report. Osborn said the state previously spent roughly 60 cents to print and mail each check, and now pays 1.5 cents to load money onto the cards, translating into hundreds of thousands of dollars in savings.
"All of the liability is placed on the bank," he said. "It's a great way to do this efficiently and lower the cost."
Osborn detailed 46 additional states that use prepaid cards to distribute some sort of government benefits. The U.S. Treasury, meanwhile, began using prepaid cards to deliver Social Security payments to people without banking accounts two years ago, which it said could cut costs by up to $44 million annually, the newspaper reported.
Government programs are also an important market for card issuers. An analysis by research firm Mercator Advisory Group tagged the sector at $69 billion in 2008, or more than a quarter of the total $247.6 billion market for prepaid cards. The government accounts segment is also rapidly growing, with the use of unemployment-benefits cards alone up 111 percent in 2008, the report noted.
Tim Sloane, director of prepaid card services for Mercator, said in the report it remains unclear what would happen if the amendment were to remain in the legislation, but issuers would be determined to recoup the revenue.
"It's clear that it's enough money that it can't be compensated by the issuers saying, 'Oh, well,' " he told the Post.
Critics also argued that the amendment allows retailers to set minimum spending requirements, which may result in retailers turning away customers who use government prepaid cards for small purchases. Those people would then be required to buy additional items to hit the threshold, or use another form of payment.
"These government cards are filling a dramatic need that no other product has done before," Kirsten Trusko, executive director of the Network Branded Prepaid Card Association, a trade group, said in the report.
Related News:
Speedway SuperAmerica Fights Swipe Fees With Petition
Vermont Passes Law to Limits Swipe Fees
Senate Votes to Include Swipe Fee Reform in Financial Regulatory Bill