Washington, DC - Legislation introduced by Senator Tester will delay for two years critical reforms aimed at providing relief to America’s small business owners. The reforms, scheduled to go into effect this summer, would limit the price-fixing engaged in by the nation’s largest banks so that they would be required either to compete on their debit card swipe fees or charge an amount that is “reasonable and proportional” to their costs.
“This bill is just another Wall Street bailout,” said Pat Lewis, who owns thirteen convenience stores in Idaho. “The Tester bill is TARP 2, when the last thing we need is another handout to the big banks.”
“This amendment is a slap in the face for small business owners and consumers across the country,” said Lyle Beckwith, Senior Vice President of Government Relations at the National Association of Convenience Stores. “Congress should be standing by Main Street and not kowtowing to Visa, MasterCard and the big TARP banks that three years ago brought our economy to its knees and whose executives last year in just 9 months were paid more than $130 billion.”
“Interfering with the process even before the final rule is written is nothing more than pandering to the giant banks,” said Jennifer Hatcher, Senior Vice President of Government and Public Affairs. “Delaying swipe fee reform has consequences that will cost merchants and their customers $1 billion each month, and will cost our economy up to 95,000 much-needed jobs each year. Killing jobs isn’t what we were promised in November.”
Senator Tester claims that he is concerned about small banks being hurt by the rules. Senator Durbin took care of that concern last year. The legislation states explicitly that banks with under $10 billion in assets will be exempted from the rates. Further, Visa, Star, and five other networks have indicated they will support two-tiered pricing so that small banks get to charge more than big banks.
Because of honor-all-cards rules in debit and credit card contracts, merchants are prohibited from treating one debit card differently than another debit card.