Friday, September 28, 2012
The MPC also cited gas stations, where station operators are taking advantage of lower processing costs for debit card transactions by incentivizing customers with discounts to get them to pay with debit cards.
"Debit swipe fee reform has been a win for consumers and Main Street businesses, especially small businesses," said Mallory Duncan, Senior Vice President and General Counsel for the National Retail Federation and Chairman of the MPC. He added that "where fees are lower, prices are lower."
But the Electronic Payments Coalition has a far different perspective. The coalition representing the financial services industry said the $8 billion retailers have saved in processing costs over the last year have not been passed on to consumers in the form of lower prices; in fact, consumers are paying on average of 1.5 percent more for goods and services since amendment's implementation.
The EPC conducted field research on the matter. To compare retailers' prices before the amendment's enactment to after, 36 shopping trips were undertaken to 18 stores nationwide, where the same items were bought pre- and post-Durbin. The research showed that, of the retailers visited, 67 percent either raised prices on those same items, or kept prices the same. Breaking down the results by store, the EPC found that, post-Durbin, shoppers paid on average:
EPC spokeswoman Trish Wexler said, "With a wink and a nod, giant retailers promised to lower prices for their customers if Congress passed the Durbin Amendment. … Let's just call a spade a spade – this was a political handout to big box retailers, who are now scrambling to make excuses for why they couldn't pass these savings along to customers."
It is also apparently in the eye of the beholder how the Durbin Amendment has affected what fees banks charge consumers for bank products like checking accounts. The MPC cited new data from Moneyrates.com that shows swipe fee reform did not affect what banks charge for their services. The MPC quoted a representative of the National Grocers Association, who said fluctuations in checking account fees and other fees are "fundamentally the same" post-Durbin as they were pre-Durbin.
However, the EPC said a recent BankRate.com survey found that checking account costs for consumers rose dramatically post-Durbin, "with some bank fees rising 25 percent or more," due in part to regulations limiting overdraft and debit card interchange fees.
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