We need your help to fight against these efforts to repeal debit reform
This week, retiring U.S. Rep. Randy Neugebauer (R-TX) introduced legislation that would repeal the Durbin Amendment and the debit swipe fee reforms hailed by NACS and the merchant community. On Wednesday, House Financial Services Committee Chairman Jeb Hensarling (R-TX) circulated a draft of his “Financial CHOICE Act,” which includes a provision to repeal debit reforms. These efforts have strong support from credit card and banking industry groups.
Since the Durbin Amendment took effect in late 2011, it has helped consumers save nearly $6 billion a year and supported about 37,000 jobs each year.
Senator Richard Durbin (D-IL) responded sharply to the introduction of H.R. 5465, noting in a statement that repealing the debit swipe fee reforms would not only be a windfall for Visa, MasterCard and the nation’s biggest banks, but would also “diminish transparency and competition in the debit card system” and harm millions of consumers and retailers.
“While the big banks and card networks may want to reopen a battle they lost six years ago, Congress’s time would be better spent investigating and reining in the new anti-competitive fees that keep popping up in the credit and debit card industries. Just last week I pointed out that Visa and MasterCard had created blatantly anti-competitive fees to penalize small banks and credit unions and deter them from doing business with other card networks. Continued vigilance by Congress and regulators is necessary to help expose these rigged schemes and ensure that the credit and debit card systems operate fairly for all Americans,” Durbin added.
Durbin’s comments were echoed by Representative Peter Welch (D-VT) who stated, “For years, Senator Durbin and I have sounded the alarm about unregulated interchange fees and the harm it does to consumers, small businesses, and the economy. The repeal of these reforms would roll back the clock on competition and transparency and allow the credit card industry to return to its practice of ripping off consumers and small businesses unabated.”
The Merchants Payments Coalition (MPC), of which NACS is a founding member, issued a statement that H.R. 5465 would promote more price-fixing and detract from the few market forces that were actually created on debit card fees. “It is unfortunate that Mr. Neugebauer chose to make one of his final acts in Congress an attempt to undermine the free market and instead support price-fixing that benefits the largest of the largest banks and threatens consumers, merchants and the entire economy,” said Doug Kantor, counsel to the MPC and NACS.
Neugebauer’s legislation comes just one week after Rep. Jeb Hensarling (R-TX), chairman of the House Financial Services Committee, announced plans to repeal swipe fee reform and the 2010 Dodd-Frank Wall Street Reform Act, which contains the Durbin Amendment. “The Hensarling proposal would promote more price-fixing and detract from the few market forces that were actually created on debit card fees,” Kantor said.
In a letter sent to Capitol Hill last month, the MPC and more than 140 national and state trade associations asked Chairman Hensarling to protect the Durbin Amendment. The Wall Street Journal reported that Donald Trump met with Hensarling last week to discuss a Republican alternative to the Dodd-Frank law. Trump said he would dismantle nearly all of Dodd-Frank, without giving specifics.
Last week NACS asked members of the c-store industry to contact their member of Congress to voice opposition to repealing debit swipe fee reform. More than 2,000 letters were sent to Capitol Hill.
NACS is now urging members to take action again and contact their representative and ask them to oppose the Neugebauer and Hensarling bills. To contact your representative, click here.