Washington, DC – Merchants and consumers reacted with outrage in response to the introduction of an amendment by Sen. Jon Tester (D-MT) aimed at undoing critical small business reforms passed a year ago. The reforms bring fairness and competition to the fees big banks and credit card companies charge merchants to process a debit card transaction.
Senator Tester’s amendment would undo critical reforms aimed at small businesses just weeks before they’re scheduled to go into effect, and would instead hand a blank check to the big banks.
More than 300 national and state trade associations signed a letter opposing the Tester delay amendment, citing the harm it will do to Main Street merchants and consumers by costing billions of dollars and 95,000 jobs.
“This bill isn’t about delaying the regulations and ‘studying’ the issue,” said Lyle Beckwith, Senior Vice President of Government Relations at the National Association of Convenience Stores. “It’s about derailing a bill that will save Main Street business owners and consumers billions of dollars—and instead putting that money in the pockets of the country’s biggest banks. Senator Tester’s amendment is a blank check to Visa, MasterCard and their big banks—and gives them permission to continue to charge merchants any amount they want for swipe fees. This is nothing more than a handout to the big banks and a slap in the face to consumers and retailers.”
The bill stops the Federal Reserve from issuing final rules, asks banking regulators to speculate on what might happen if swipe fees are capped, and uses big bank talking points as the data. The “study” is a suspension and repeal of the Federal Reserve’s rules, even though such a change would hurt the economy as a whole.
Small business will continue to struggle under the current system ever day swipe fee reforms are delayed, to the tune of more than $1 billion per month.
According to the Federal Reserve, merchants pay 44 cents every time a debit card is swiped in their store despite data that suggests the transaction costs only 4 cents to process. Reforms are scheduled to take effect July 21.
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