Creditnet News Story
Compromise reached with swipe fee amendment
Tuesday, June 22, 2010
By Linda McCarthy
Merchants and credit card issuers can let out a sigh of relief as a compromise has been reached on the Wall Street bill.
A compromise has been reached between Illinois Senator Dick Durbin and House members regarding transaction fees.
Card issuers' big win comes from the removal of a provision that would allow merchants to offer discounts depending on card network.
However, retailers come out on top as well. The compromise proposes allowing merchants to offer discounts for cash versus card payments.
The revisions to the amendment would still provide merchants with some flexibility and relief from card fees.
"If properly implemented, it could provide merchants with significant card acceptance cost relief," says National Retail Foundation senior vice president and general counsel Mallory Duncan. "Most important, for the first time ever the U.S. Congress will have opened the door to legislative solutions for runaway interchange."
Card companies bring in a large amount of profits from transaction fees. The NRF says that interchange costs paid to Visa and MasterCard were over $40 billion in 2009.
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