Visa, Mastercard, banks in $7.25 billion swipe-fee settlement (Reuters)

(Reuters) – Visa Inc, Mastercard Inc and banks issuing their credit cards have agreed to a settlement valued at $7.25 billion and will allow stores to encourage customers to use cheaper forms of payment, according to settlement papers filed on Friday in a lawsuit in Brooklyn federal court.

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Merchants Reach Landmark $7.25 Billion Settlement with Visa, MasterCard and Major U.S. Banks for Alleged Anticompetitive Practices and Price Fixing In Setting Interchange Fees

MINNEAPOLIS, July 13, 2012 /PRNewswire via COMTEX/ — Robins, Kaplan, Miller & Ciresi L.L.P. has reached an historic $7.25 billion settlement on behalf of a class of approximately seven million merchants in the United States who accept Visa and MasterCard credit cards and debit cards. The settlement is with payment card networks Visa and MasterCard and with card-issuing banks, including JPMorgan Chase, Bank of America, Citibank, Wells Fargo, Capital One and other major banks.

Robins, Kaplan, Miller & Ciresi L.L.P. filed the case in 2005, and was appointed by the United States District Court for the Eastern District of New York, along with two other law firms, to represent the class in the case. The settlement that has now resolved the case is believed to be the largest ever settlement of a private antitrust case under the Sherman Act (15 U.S.C. section 1 et seq.).

The settlement terms include a cash payment and significant reforms of Visa and MasterCard rules and business practices. The cash component of approximately $7.25 billion consists of a payment for alleged past damages in the amount of $6.05 billion, and a further payment representing the value to merchants of a temporary reduction in the level of interchange fees paid by merchants on Visa and MasterCard credit card transactions, estimated to have a value of $1.2 billion. The reforms of rules and business practices include modifications of network rules previously enforced by Visa and MasterCard relating to activity at the point-of-sale, as well as a new requirement that Visa and MasterCard negotiate with merchant-organized buying groups. The modification of these network rules will provide additional value to merchants of many billions of dollars by enabling merchants to provide greater transparency to consumers regarding the cost of using various types of payment methods, and permitting merchants to negotiate collectively over interchange fees and other aspects of their relationships with Visa and MasterCard. It is expected that the reforms required by the settlement will enable merchants to put pressure on Visa and MasterCard to limit or reduce interchange fees, among other things.

“The reforms achieved by this case and in this settlement will help shift the competitive balance from one formerly dominated by the banks which controlled the card networks to the side of merchants and consumers,” states K. Craig Wildfang, who led the case for the Class Plaintiffs as co-lead counsel and partner at Robins, Kaplan, Miller & Ciresi L.L.P. “Over time, the reforms induced by this case and in this settlement should help reduce card-acceptance costs to merchants, which in turn, will result in lower prices for all consumers.”

Martin R. Lueck, Chairman of the Executive Board at Robins, Kaplan Miller & Ciresi L.L.P. adds, “These reforms go a long way to achieving price transparency for the most heavily used form of payment in the United States, which will benefit consumers.”

“As an ecommerce business who has to rely on credit cards, this historic settlement and the reforms it brings will provide both immediate and lasting benefits for small merchants,” states Mitch Goldstone, President & CEO of ScanMyPhotos.com, a division of Photos Etc. Corporation.

The case is In re Payment Card Interchange Fee and Merchant Discount Litigation, 05-MD-1720 (JG)(JO). The other two co-lead counsel law firms that represent the class of merchants are Berger & Montague, P.C. and Robbins Geller Rudman & Dowd LLP.

About Robins, Kaplan, Miller & Ciresi L.L.P.

Robins, Kaplan, Miller & Ciresi L.L.P. ( http://www.rkmc.com ) is one of the top trial firms in the country. The firm’s clients include numerous Fortune 500 corporations, emerging markets companies, entrepreneurs, and individuals as both plaintiffs and defendants. Robins, Kaplan, Miller & Ciresi L.L.P. is frequently engaged in high-stakes, complex litigation with significant bottom-line implications for their clients, and the business lawyers handle complex transactions in a variety of market segments. The firm has more than 250 lawyers located in Atlanta, Boston, Los Angeles, Minneapolis, New York and Naples (FL).

Robins, Kaplan, Miller & Ciresi L.L.P. received The National Law Journal’s 2011 Pro Bono Award and was selected as a Pro Bono Firm of 2010 by Law360. The American Lawyer ranked the firm eighth in the country in the 2011 Pro Bono Survey, and twice named the firm to the A-List (2007 and 2004). The firm has regularly received a top ranking for litigation from Chambers USA and was chosen as a “Go-To Law Firm” by Corporate Counsel.

SOURCE Robins, Kaplan, Miller & Ciresi L.L.P.

Visa spent $1.69M on federal lobbying in 3Q – BusinessWeek #swipefees

Visa Inc. spent $1.69 million in the third quarter to lobby the federal government on the regulation of debit card fees charged to merchants and other issues, according to a disclosure report.

via Visa spent $1.69M on federal lobbying in 3Q – BusinessWeek.

Get Ready For Bank Fee Whack-A-Mole | Moneyland | TIME.com #swipefees

The dust has barely settled over the debit card fee-flap but there’s more news from the big banks regarding fees. The good news is that it’s not all bad this time — both Bank of America and Chase have abandoned fees that were under consideration or in the testing phase. Meanwhile, though, banks are quietly calculating which other ones can take their place.

via Get Ready For Bank Fee Whack-A-Mole | Moneyland | TIME.com.

Debit Card Fee Debacle: Big Banks Could Lose $185 Billion In Deposits Next Year. #SwipeFees (Huff Post)

The top 10 retail banks are projected to lose $185 billion in deposits over the next year if they dont address consumer concerns, according to a recent study from cg42, a firm that consults with banks. Bank of America, Citibank, JPMorgan Chase and Wells Fargo account for nearly three-quarters of the loss, the study found.

via Debit Card Fee Debacle: Big Banks Could Lose $185 Billion In Deposits Next Year, Report Finds.

The Green Sheet :: E-Magazine :: Washington takes a second look at Durbin #Swipefees

Call for antitrust investigation

A day after the anti-Durbin bill was introduced, congressional Democrats asked Attorney General Eric Holder to consider an anti-trust investigation of financial institutions on grounds they are colluding to create new fees to cover losses related to the Durbin Amendment’s debit interchange fee cap.

On Oct. 13, 2011, five Democratic congressmen led by Chief Deputy Whip Peter Welch, D-Vt., wrote Holder asking for the anti-trust investigation of “big banks [that] are coordinating their fee strategies in violation of federal anti-trust laws.”

via The Green Sheet :: E-Magazine :: Washington takes a second look at Durbin.

After Debit Card Uproar, Banks Look to Sneaky Fees – ABC News #swipefees

For years, banks have had an arsenal of fees they could charge consumers to increase revenues, said Ed Mierzwinski, consumer program director of U.S. Public Interest Research Group, which published a report, Big Banks, Bigger Fees, earlier this year.

via After Debit Card Uproar, Banks Look to Sneaky Fees – ABC News.

Berkshire: Buffett Buys Millions in Visa and CVS Stock – Stocks To Watch Today – Barrons.com

Not content to own just Mastercard (MA), Warren Buffett added Visa (V) to Berkshire Hathaway’s (BRKB) portfolio in the third quarter, according to a filing released after the market closed. Buffett reported owning 2.29 million shares of Visa in the quarter. He maintained his stake in MasterCard, which he also added to the portfolio this year, at 405,000 shares.

via Berkshire: Buffett Buys Millions in Visa and CVS Stock – Stocks To Watch Today – Barrons.com.

Intel and MasterCard Join Forces to Enhance the Consumer Payment Experience (Press Release)

Intel Corporation and MasterCard Incorporated announced today a multi-year strategic collaboration to further enhance the security and consumer payment experience for online shopping. “MasterCard is constantly working to improve the shopping experience for consumers and merchants”The collaboration will combine MasterCard’s expertise in payment processing and commerce with Intel’s strengths in silicon innovation and chip-based security. It is designed to provide more options for a safer and simpler checkout process for online merchants and consumers using Ultrabook™ devices and future generations of Intel-based PCs.

via Intel and MasterCard Join Forces to Enhance the Consumer Payment Experience for Online Shopping | Business Wire.

Visa, MasterCard Estimate Potential Fee Settlement at $4 Billion- Bloomberg #swipefees

Banga didn’t say that any settlement was imminent, either in the class action or in suits brought by individual merchants including Publix Super Markets Inc. (PUSH), the Lakeland, Florida-based supermarket chain, and Rite Aid Corp. (RAD), the Camp Hill, Pennsylvania-based drugstore chain.

‘via Visa, MasterCard Estimate Potential Fee Settlement at $4 Billion- Bloomberg.

David Lazarus; Bank of America; Chase – latimes.com #SwipeFees

Bank of America retreated this week from its planned introduction of a $5 monthly fee for many customers to use their debit cards. The bank said it “listened to our customers very closely” and decided that charging people money to access their money maybe wasn’t the best idea after all.

via David Lazarus; Bank of America; Chase – latimes.com.

 http://latimes.vid.trb.com/player/PaperVideoTest.swf

Visa, MasterCard still fixing card fees -merchants | Reuters #swipefees

Nearly eight years after Visa Inc and MasterCard Inc agreed to pay more than $3 billion to resolve allegations that they conspired to raise stores’ fees for processing their payment cards, merchants returned to court on Wednesday to argue that the card companies still maintain a costly stranglehold on interchange networks.

U.S. District Judge John Gleeson heard oral arguments in Brooklyn federal court from a slate of lawyers representing the credit card companies, their issuing banks and the merchants over whether to proceed to trial on the latest round of antitrust allegations against the card companies’ and banks’ interchange networks, which process customers’ credit- and debit-card payments to stores.

via Visa, MasterCard still fixing card fees -merchants | News by Country | Reuters.

MasterCard Estimates Settlement of Big Interchange Cases Could Cost It $500 Million (Digital Transactions) #Swipefees

Minneapolis attorney K. Craig Wildfang, lead attorney for the class plaintiffs, said he would not comment about the MasterCard disclosure. But Mitch Goldstone, president and chief executive of one of the named class plaintiffs, ScanMyPhotos.com in Irvine, Calif., said he believes the Occupy Wall Street anti-corporate demonstrators and their sympathizers are having an effect on the defendants.

“I’m having the best level of comfort since 2005 that this could be resolved very quickly,” Goldstone says. “Those [Occupy Wall Street participants] are the people that are going to be jurors next fall. The banks know it.”

Trial is set to start Sept. 12, 2012.

 

http://www.digitaltransactions.net/news/story/3262

Visa, MasterCard still fixing card fees -merchants | Reuters #SwipeFees [WayTooHigh.com]

Nearly eight years after Visa Inc and MasterCard Inc agreed to pay more than $3 billion to resolve allegations that they conspired to raise stores’ fees for processing their payment cards, merchants returned to court on Wednesday to argue that the card companies still maintain a costly stranglehold on interchange networks.

via Visa, MasterCard still fixing card fees -merchants | News by Country | Reuters.

Ellen DeGeneres’ Bank of America Debit Fee: Spoof Video

Decision to impose monthly surcharges on debit cards gouges unwary consumers | McClatchy #SwipeFees

Mallory Duncan is Senior Vice President and General Counsel of the National Retail Federation (www.nrf.com), the world’s largest retail trade association whose global membership includes more than 1.5 million American companies that employ nearly 25 million workers. Readers may write him at NRF, 325 7th Street NW, Suite 1100, Washington, DC 20004.

via Decision to impose monthly surcharges on debit cards gouges unwary consumers | McClatchy.

Chase and Wells Fargo drop debit card fee tests; Bank of America set to adjust its plan – The Washington Post #swipeFees #OWS

Signs like, “I bailed out the banks and all I got was a $5 debit card fee” have been spotted the Occupy Wall Street protest in New York and its sibling protests around the country. The author of the regulations, Sen. Richard Durbin, D.-Ill, called the fee an “outrage” on the floor of the Senate.

via Chase and Wells Fargo drop debit card fee tests; Bank of America set to adjust its plan – The Washington Post.

Decision to impose monthly surcharges on debit cards gouges unwary consumers | McClatchy #SwipeFees

Next on the agenda will be reform of credit card fees, which are even more excessive than debit fees and just as obscure.

In 2010, the banking industry raked in about $30 billion in swipe fees on credit card transactions – over and above profits on late fees, annual fees, over-the-limit fees and interest. Not only do banks require merchants to collect fees averaging 2-3 percent of each credit card transaction, until swipe fee reform passed they effectively prevented retailers from offering a discount to customers who paid with cash.

via Decision to impose monthly surcharges on debit cards gouges unwary consumers | McClatchy.

Chase and Wells Fargo drop debit card fee tests; Bank of America set to adjust its plan – The Washington Post

Chase and Wells Fargo are joining the list of banks that won’t be charging customers to use their debit cards, as the backlash over Bank of America’s planned $5 monthly fee continues.

via Chase and Wells Fargo drop debit card fee tests; Bank of America set to adjust its plan – The Washington Post.

Vermont Congressman Says New Debit Card Fees Warrant Investigation – WBOY-TV – WBOY.com

“It appears that banks are seeking to justify fee increases after Congress and the Federal Reserve Board recently limited banks’ ability to collude with networks to set debit interchange fees,” the letter said. “Statements made by individual banks and their trade associations raise questions about whether some price increases that have occurred this year have actually been coordinated.”

via Vermont Congressman Says New Debit Card Fees Warrant Investigation – WBOY-TV – WBOY.com.

Durbin Amendment: A Weak Excuse for New Bank Fees #swipefees

“Merchants are counting their new found gains at our expense and our elected officials still don’t comprehend the damaging impact of their misguided legislation,” wrote Patrick J. Swanick, a retired KeyBank vice chairman and former president of Key’s retail bank and CEO of Key Electronic Services, on October 10 in the American Banker.

via Durbin Amendment: A Weak Excuse for New Bank Fees.

Local banks see boost from customers fleeing fees | Daily Progress

“Whenever there has been frustration or negative publicity with other institutions, the credit union is where people turn,” Williams said. She added that the credit union does not plan to implement any fees on their checking accounts.

via Local banks see boost from customers fleeing fees | Daily Progress.

Parker Sues to Protect PumpPal Debit Program #swipefees

Greg Parker, president of Parker Cos., Savannah, Ga., has filed a lawsuit to block the state’s plan to end the way he advertises his PumpPal discount gasoline program, reported the Savannah Morning News. The suit asked Chatham County Superior Court Judge Louisa Abbot to temporarily halt new rules that would ban display of reduced debit-card gasoline prices.

via Parker Sues to Protect PumpPal Debit Program#.TpNPCcCTK5g.twitter.

Local banks see boost from customers fleeing fees | Daily Progress

“Whenever there has been frustration or negative publicity with other institutions, the credit union is where people turn,” Williams said. She added that the credit union does not plan to implement any fees on their checking accounts.

via Local banks see boost from customers fleeing fees | Daily Progress.

Occupy Wall Street Organizing Nationwide Boycott Against Banks #swipefees

Protestors are calling the event “Bank Transfer Day” and are encouraging people nationwide to participate November 5.

via News Headlines.

Bank of America debit card fee prompts animosity from coast to coast – latimes.com

The new $5 monthly charge has become a focal point for anger and frustration about the flailing economy and Washingtons attempts to help the nation recover from the financial crisis.

via Bank of America debit card fee prompts animosity from coast to coast – latimes.com.

Debit Card Fees Are Robbery – NYTimes.com Part II #swipefees

The Fed had been established in 1913 in large measure to end the then widespread practice of banks’ charging a similar “interchange” fee for the use of paper checks. Those check interchange fees were slowing the growth of interstate commerce, and the Fed quickly prohibited them. The interchange fees that banks now charge stores for debit transactions are economically and functionally identical to the check interchange fees prohibited by the Fed almost a century ago.

via Debit Card Fees Are Robbery – NYTimes.com.

Debit Card Fees Are Robbery – NYTimes.com #swipefees

For decades, Bank of America, the founding owner and member of Visa originally called BankAmericard and all of the Visa and MasterCard banks, including Chase, hid the identity of their debit cards from stores by designing them to look and function like their signature authorized credit cards and by charging stores the same price for debit and credit transactions. Banks did this despite the fact that purchases made with a debit card didn’t involve a loan from the bank, posed very little fraud risk and were extravagantly profitable to banks because they eliminated the costs of processing and clearing checks.

via Debit Card Fees Are Robbery – NYTimes.com.

Bank of America; debit card; monthly fee – latimes.com #swipefees

For its part, BofA has estimated that these new rules will cost it about $2 billion annually in lost revenue. Industrywide, these processing fees brought in $19 billion for banks in 2009, according to the Nilson Report, which tracks card payments.

via Bank of America; debit card; monthly fee – latimes.com.

What other banks or credit unions plan to charge for debit card use | OregonLive.com

On Saturday, a new rule went into effect capping debit-card swipe fees collected from merchants by banks with more than $10 billion in assets. Those fees had generated $19 billion in revenue for banks in 2009, according to the Nilson Report

via What other banks or credit unions plan to charge for debit card use | OregonLive.com.

Debit Interchange Cuts May Drive More Consumers To Credit Cards – PaymentsSource Article #swipefees

New Federal Reserve Board rules that on Oct. 1 will reduce debit card interchange revenue for larger issuers may cause banks to raise fees associated with using debit cards, and that could drive consumers to use credit cards more, a new research paper from the Federal Reserve Bank of Boston contends.

via Debit Interchange Cuts May Drive More Consumers To Credit Cards, Report Suggests – PaymentsSource Article.

Retailer Fees to Soar on Some Debit-Card Transactions | #swipefees

Merchants could end up paying 24 cents — the maximum fee allowed — on a $2 purchase, three-times as much as the 8 cents they would pay under the current system, according to a note to investors by Janney Montgomery Scott LLC analyst Thomas McCrohan that was reported by Bloomberg News.

via Retailer Fees to Soar on Some Debit-Card Transactions | LoanSafe.org.

Visa, MasterCard reportedly planning to hike merchant cost for small purchases on debit cards (#swipefees)

Visa Inc. and MasterCard Inc. are reportedly planning to dramatically raise the fee charged to merchants for small ticket items, according to Janney Capital Markets analyst Thomas McCrohan

via Visa, MasterCard reportedly planning to hike merchant cost for small purchases on debit cards – The Washington Post.

Wells Fargo to charge customers for debit cards

The US lender has joined the ranks of other rivals and is to charge a fee of $3 per month for debit card users in five US states from October on.

via Wells Fargo to charge customers for debit cards.

Banks look to add more fees to debit cards | www.WHEC.com

Wells Fargo plans to test an activity fee of $3 s a month starting in October. The bank plans to try out the fee in five states — Oregon, New Mexico, Nevada, Georgia and Washington.

via Banks look to add more fees to debit cards | www.WHEC.com.

Debit card fees could signal trend #swipefees

In recent months, many of the nation’s biggest banks, including SunTrust, Wells Fargo and Bank of America, reworked their requirements for checking accounts. Many featured new fees or put up new hurdles for customers to receive waived fees. Some banks also dropped rewards programs for debit cards.

via Debit card fees could signal trend.

Some Debit Cards Will Soon Carry Fees – My Money usnews.com

Wells Fargo just announced that it will test a $3 monthly fee for those who use its debit card. The fee will be levied against customers in Georgia, New Mexico, Nevada and Oregon beginning October 14, 2011. As a result, we can add debit card fees to the long list of bank fees we love to hate. To understand why Wells Fargo is testing a debit card fee, we need look no further than the fine folks in Washington.

via Some Debit Cards Will Soon Carry Fees – My Money usnews.com.

The Cost Of Confusion: How Merchants Can Deal With New Rules On Debit Card Fees – CIO Central – CIO Network – Forbes

Merchants have long been forced to navigate a complicated web of possible options for payment processing, all featuring their own unique fee structures.

via The Cost Of Confusion: How Merchants Can Deal With New Rules On Debit Card Fees – CIO Central – CIO Network – Forbes.

Credit Newsline » Blog Archive » Visa to add fixed network participation fee

Visa Inc. announced last week that it will offer a fixed network participation fee for both credit and debit cards in order to stay competitive in the post-Durbin Amendment marketplace.

via Credit Newsline » Blog Archive » Visa to add fixed network participation fee.

MasterCard Earnings Up 33% – WSJ.com

MasterCard Inc.’s second-quarter earnings climbed 33% as the company benefited from double-digit increases in volume and processed transactions.

via MasterCard Earnings Up 33% – WSJ.com.

Financial Reform: One Year Later | NACS Online >

The news source writes that since the law took effect, the largest debit-card issuers, “which stand to lose billions of dollars in annual revenue under the Fed caps,” have already begun to eliminate rewards programs and free checking — and that “new fees may be next in the effort to help make up the difference, according to analysts and executives.”

via Financial Reform: One Year Later | NACS Online > News & Media Center > News.

Small banks, merchants see $$ in swipe fee reform | Hartford Business

Every time a customer pays with a credit or debit card, the merchant must pay a fee to the bank or financial institution to process the transaction. The fees vary greatly depending on debit or credit, whether a signature or a PIN is required, and what the merchant has negotiated with the bank. In Connecticut, the average fee for debit transactions is 44 cents.

via Small banks, merchants see $$ in swipe fee reform | Hartford Business.

Reply Letter From U.S. Senator Barbara Boxer to Mitch Goldstone (President & CEO, ScanMyPhotos.com, editor of WayTooHigh.com)

Dear Mr. Goldstone:

Thank you for writing to me regarding legislation that would postpone proposed reductions in interchange fees that credit card companies impose on debit card transactions.  I appreciate hearing from you on this important issue.

Last year, as part of the Wall Street Reform and Consumer Protection Act (P.L.111-203), Congress enacted an amendment by Senator Richard Durbin requiring the Federal Reserve to set allowable levels for the interchange fees that would be “reasonable and proportional to the cost incurred by the issuer.”  As directed by the Durbin Amendment, the Federal Reserve has issued a final rule reducing these fees to 21 cents per transaction, plus 0.05 percent of the transaction’s value, beginning October 1, 2011.

I am pleased that the Senate recently defeated legislation calling for a lengthy study of the Fed’s proposed rule.  I believe that this rule will enable small businesses and merchants to lower their costs and provide discounts for their customers, and that further study would needlessly delay an important reform.  Be assured that I support the Durbin Amendment and will continue to oppose efforts to repeal or undermine it.

Again, thank you for writing to me.  Please feel free to contact me again about this or other issues of concern to you.

Sincerely,

Barbara Boxer
United States Senator

French Banks Slash Bank Card Fees to Settle Antitrust Probe – Bloomberg #swipefees

The group that governs France’s bank- card industry agreed to cut by as much as 36 percent interbank fees for bank card transactions to settle a competition regulator’s investigation

via French Banks Slash Bank Card Fees to Settle Antitrust Probe – Bloomberg.

Retail’s BIG Blog | NRF’s David French discusses #swipefees rules on CNBC

NRF Senior Vice President David French appeared on CNBC’s Closing Bell to discuss the ramifications of the ruling for retailers and express disappointment in the Fed’s decision.

via Retail’s BIG Blog | NRF’s David French discusses swipe fee rules on CNBC.

Federal Reserve Credit Card Swipe Fees Raises Hackles With Businesses – Capital – Portfolio.com

“This rule will not provide businesses and consumers with the savings they deserve under the law,” said Scott DeFife, executive vice president at the National Restaurant Association.

via Federal Reserve Credit Card Swipe Fees Raises Hackles With Businesses – Capital – Portfolio.com.

Why the Fed needs to replace bark with bite | Felix Salmon

First they encourage consumers to sign for debit purchases despite the fact that such purchases are much less secure; then they argue that they need high interchange fees because they have high fraud costs. This is financial chutzpah incarnate: the equivalent of the man who kills both his parents and then pleads for clemency on the grounds that he’s an orphan.

via Why the Fed needs to replace bark with bite | Felix Salmon.

Retailers to fight new debit card #swipefees – Washington Times

Angry retailers Thursday promised to fight a new Federal Reserve decision reversing its previous position and nearly doubling the maximum amount banks can charge on “swipe fees” when customers make debit card purchases.

via Retailers to fight new debit card fees – Washington Times.

Reviews Are in on Fed’s Final Debit Rule: Thumbs Down from Both Retailers And Banks #SwipeFees

“I’m disappointed but I understand how wealthy the banking lobby is and how connected they are with the Fed,” Mitch Goldstone, president and chief executive of Irvine, Calif.-based ScanMyPhotos.com, tells Digital Transactions News.

Goldstone, however, still calls the final rule “a great first step” and says merchants will get a shot at a bigger target in September 2012, when their proposed antitrust class-action challenging credit card interchange goes to trial. ScanMyPhotos is a plaintiff in that suit pending in U.S. District Court in Brooklyn, N.Y. “The big number is credit cards,” he says.

via. Digital Transactions Magazine – http://www.digitaltransactions.net/news/story/3108

How Wal-Mart Swiped JPMorgan in $16 Billion Debit-Card Lobbying Battle – Bloomberg

Retailers have long fumed about the cost of taking plastic. Unlike with checks, banks charge them fees, known as interchange, to process debit and credit card payments. Debit fees average 44 cents per transaction or about $16 billion a year. The amounts are set by Visa and MasterCard, which own the payment networks and pass the money to the banks.

via How Wal-Mart Swiped JPMorgan in $16 Billion Debit-Card Lobbying Battle – Bloomberg.

The PR Mastermind Who Coined the Term ‘Swipe Fees’ – Bank Think #SwipeFees

West is widely credited in retailer circles with having coined an alternative, “swipe fees.” It caught on, and eventually became a rallying cry for Senator Richard Durbin, the Illinois Democrat who successfully pushed for a cap on debit interchange rates in last year’s Dodd-Frank financial reform law. This afternoon, bankers will find out exactly how much they will be permitted to charge on debit transactions when the Federal Reserve Board issues a final rule implementing the Durbin amendment. (Credit card interchange was unaffected.)

via The PR Mastermind Who Coined the Term ‘Swipe Fees’ – Bank Think.

Fed Caps Debit Card Fees for Merchants – NYTimes.com #swipefees

The new fee schedule includes three parts: a maximum interchange fee of 21 cents; a 1 cent addition that is allowed if the bank issuing the debit card develops a fraud-prevention program; and a variable charge of 5 basis points, or five one-hundredths of a percentage point, of the value of the transaction to recover a portion of fraud losses

via Fed Caps Debit Card Fees for Merchants – NYTimes.com.

NACS Calls Fed’s Final Rule ‘An Irresponsible Abdication of Its Legal Duty’ | NACS Online > News & Media Center > News

The final rules issued today set a per-transaction debit swipe fee of 21 cents, which is significantly higher than the Federal Reserve’s originally proposed rate of 7 cents or the compromise rate of 12 cents. The rules also add 0.05 percent of the transaction amount for fraud prevention.

via NACS Calls Fed’s Final Rule ‘An Irresponsible Abdication of Its Legal Duty’ | NACS Online > News & Media Center > News.

Editorial | Debit card fee cuts | The Courier-Journal | courier-journal.com

Retailers bear the initial brunt, but the swipe fees are passed on to the consumer in the end. NPR reports that banks make about $16.9 billion a year from these fees. The 12-cent cap would decrease that amount by $12 billion.

via Editorial | Debit card fee cuts | The Courier-Journal | courier-journal.com.

Fed Sets Vote on Debit-Card Fee Curbs – WSJ.com

The Federal Reserve next week is scheduled to vote on its final plan to regulate debit-card processing fees, giving banks and credit unions their first look at new fee curbs set to take effect next month. The public meeting is slated for the afternoon of June 29, according to a meeting notice the Fed released Tuesday afternoon.

via Fed Sets Vote on Debit-Card Fee Curbs – WSJ.com.

Merchants Shred Costs of Payments by Plastic – SmartMoney.com #swipefees

As part of last year’s Dodd-Frank financial-overhaul law, debit-card fees will drop about 75% on July 21. The Federal Reserve, which is issuing the interchange-fee rules, has proposed capping fees at about 12 cents per transaction for large banks, down from the current average of 44 cents. The Fed hasn’t announced the final figure yet.

via Merchants Shred Costs of Payments by Plastic – SmartMoney.com.

Latest Anti-Durbin Argument is Desperate and Absurd – Bank Think

The latest attempt to resurrect the viability of the small issuer exemption should bring us back to the core reasons why the banks arguments are demonstrably false. As everyone in the industry knows, merchants are required to accept all debit cards, regardless of the issuer, under the “honor all cards” rules that are in place at all of the debit networks.

via Latest Anti-Durbin Argument is Desperate and Absurd – Bank Think.

Convenience Store News Mobile

Today, the U.S. Department of Justice Antitrust Division submitted a a final consent decree in its enforcement action against Visa and MasterCard to address some of the anti-competitive practices related to credit cards, according to a release from the Food Marketing Institute (FMI).

via Convenience Store News Mobile.

Banking Industry Girds for Debit-Card War in Court – WSJ.com

TCF Financial Corp., a Minnesota bank and one of the largest debit-card issuers, sued the Fed last October, saying that large financial institutions are unfairly targeted. A hearing Thursday in a federal appeals court will give TCF a second chance at an injunction to stop the rule.

via Banking Industry Girds for Debit-Card War in Court – WSJ.com.

Retailers React to Swipe-Fee Victory | CSP Daily News – CSP Information Group, Inc.

“For millions of small-business owners across America, swipe fees are the difference between breaking even or going bust. It can mean hiring a new worker–or having to let an old one go. It can mean passing along savings to customers–or losing the sale. For years, unfair and excessive swipe fees have held Main Street back. But not anymore,” said Dennis Lane, -Eleven franchisee and national spokesperson for Reform Swipe Fees NOW!.

via Retailers React to Swipe-Fee Victory | CSP Daily News / Magazine | Services – CSP Information Group, Inc. – news for convenience & petroleum retailing..

Visa, MasterCard Still Strong as Congress Attacks Bank Fees | InvestorPlace

Furthermore, it remains to be seen to what extent to banks will scale back their issuance of debit cards. The long-term, secular trend is toward electronic payments, and it is hard to imagine Americans abandoning their cards and returning to paper checks or cash any time soon. While the rate of growth might slow, in the end most Americans would acquiesce to paying a nominal fee before they abandoned their cards.

via Visa, MasterCard Still Strong as Congress Attacks Bank Fees | InvestorPlace.

National Retail Federation Calls Swipe Fee Vote Victory For American Consumers

Washington, June 8, 2011 — Matthew Shay, President and CEO of the National Retail Federation, today issued the following statement upon Senate rejection of the Tester-Corker amendment to delay swipe fee reform:

“This is a landmark victory for American consumers that will give them the break from skyrocketing swipe fees that they have been seeking for years.

“With the economy still trying to gain momentum and consumers facing skyrocketing costs for necessities like food and fuel, this badly needed reform will help ensure our nation’s economic recovery.  It will prevent more than a billion dollars a month from being pocketed by big banks and, in turn, allow retailers to hold down prices for consumers.

“Congress came to the right conclusion last year – hidden swipe fees charged by big banks have driven up prices far too much for far too long.  The National Retail Federation and America’s retail merchants commend the Senate for standing by last year’s vote and for voting on the side of American consumers.”

As the world’s largest retail trade association and the voice of retail worldwide, the National Retail Federation’s global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the U.S. and more than 45 countries abroad. In the U.S., NRF represents the breadth and diversity of an industry with more than 1.6 million American companies that employ nearly 25 million workers and generated 2010 sales of $2.4 trillion. http://www.nrf.com

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Senate swipes banks’ hopes – Scott Wong – POLITICO.com

The banking industry’s multimillion-dollar PR blitz and lobbying campaign to block caps on debit card swipe fees ended Wednesday when the Senate allowed a key piece of the Wall Street reform law passed last year to move ahead.

via Senate swipes banks’ hopes – Scott Wong – POLITICO.com.

Senate Votes Against Delay of Debit Card Fee Limits – NYTimes.com

The Wednesday vote, which followed a vigorous floor debate, was a victory for retailers, who have complained that banks and the companies that control the largest debit card networks, Visa and MasterCard, have consistently raised the fees on debit card transactions even as the market has grown rapidly and technology costs have declined.

via Senate Votes Against Delay of Debit Card Fee Limits – NYTimes.com.

Senate Fails to Delay New Debit-Card Rules – WSJ.com

Mr. Durbin called the Tester proposal to delay the fee limits “a big-bank windfall” during a floor speech before the vote. “It would give them a free pass to continue their anticompetitive practices for at least another year.”

via Senate Fails to Delay New Debit-Card Rules – WSJ.com.

Senate Rejects Delay of Debit Swipe-Fee Rule – Bloomberg

These bipartisan reforms will bring meaningful relief to millions of merchants and consumers,” Sandy Kennedy, president of the Retail Industry Leaders Association, said in a statement after the vote. “With this distraction now behind us, retailers await the Federal Reserve’s final rules so they can begin implementing these reforms and saving consumers money.”

via Senate Rejects Delay of Debit Swipe-Fee Rule – Bloomberg.

Senate Votes Against Delay of Debit Card Fee Limits – NYTimes.com

Mr. Durbin said that a delay of the debit rules would have kept fees at current levels and given banks “a windfall of profit that they do not deserve.”

via Senate Votes Against Delay of Debit Card Fee Limits – NYTimes.com.

Senate Votes To Continue With Debit Card Swipe Fee Slash – The Consumerist

Starting next month, the largest banks will only be allowed to charge retailers $.12 per transaction on debit card purchases. The current swipe fee averages $.44 per transaction.

via Senate Votes To Continue With Debit Card Swipe Fee Slash – The Consumerist.

Visa, MasterCard Drop as Attempt to Delay New Regulations Fails – Stocks To Watch Today – Barrons.com

The failure to delay the rules would initially hit credit card issuers, including big banks like JPMorgan Chase (JPM), but the pain will invariably trickle down to processors like Visa and Mastercard.

via Visa, MasterCard Drop as Attempt to Delay New Regulations Fails – Stocks To Watch Today – Barrons.com.

Visa, Mastercard Sideswiped by Senate – MarketBeat – WSJ

The fee cut could cost the card industry and banks billions of dollars, but nobody in the retail business is shedding any tears — it will save them money.

via Visa, Mastercard Sideswiped by Senate – MarketBeat – WSJ.

The Merchants Payments Coalition issued the following statement in response to today’s successful vote against Sen. Jon Tester’s (D-MT) amendment

“Merchants and consumers across the country owe a huge thank you to all of the Senators who reaffirmed the swipe fee reform law in the face of unprecedented pressure from Wall Street banks. For nearly a decade, the country’s biggest banks and credit card companies have worked tirelessly against these long-awaited reforms, and Main Street has finally prevailed. Today’s vote sent a message to the big banks and their allies that the Senate is prepared to support Main Street by protecting these critical reforms.
“The Federal Reserve can now proceed with its rulemaking to curb swipe fee abuse, and we look forward to seeing the final rule so that Main Street retailers and consumers can start seeing some relief from out-of-control debit fees on July 21.” 
 
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The Merchants Payments Coalition is a group of convenience stores, retailers, and small business owners whose membership associations represent approximately 2.7 million stores and 50 million employees. For more information, go to http://www.unfaircreditcardfees.com or visit us on Twitter. 
 

Tester Amendment fails with 54 ayes to 45 nays.

Senate lets the Fed slash debit card fees paid to banks

http://www.usatoday.com/money/perfi/credit/2011-06-08-debit-card-swipe-fees_n.htm.

Senate votes to let Fed trim debit card #swipefees

The Senate voted to let the Federal Reserve trim the fees that stores must pay banks each time a customer swipes a debit card, handing merchants a victory over banks in a lobbying battle over billions in revenue.

Durbin Delay Looks Dead – TheStreet

Durbin spokesman Max Gleischman told TheStreet the Tester-Corker measure lacks the 60 votes it needs, though he would not comment on how many votes he believes Tester has. A Tester spokeswoman did not respond to a request for comment.

via Durbin Delay Looks Dead – TheStreet.