Senate Rejects Delay in Capping Debit Card Swipe Fees
The Senate has voted to let the Federal Reserve limit the fees that stores pay banks each time a shopper swipes a debit card.
It's a victory for merchants in a long-running lobbying fight with banks.
"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," said Matthew Shay, president and CEO of the National Retail Federation, the retail industry's trade group and main lobbying arm of the industry.
At issue is a Fed proposal that's set to take effect next month and would cap the fees at 12 cents per transaction, compared with the current average of 44 cents per swipe.
Senators who wanted to block the Fed's plan needed 60 votes to prevail. But Wednesday's vote was 54-45 — six short of 60.
The Fed says the current transaction fee earns banks and credit card companies $16 billion a year.
Stores say the lower swipe fees will let them lower their prices. Banks say they will have to raise other fees, such as checking account fees.
Shares of Visa and MasterCard remained lower following the news. Discover and Capital One were also trading lower.