A year after a bipartisan group of senators voted to stay the course with debit-card swipe-fee reforms for the nation's merchants, the National Restaurant Association (NRA)
is commending lawmakers for that important decision -- but reminding policymakers that more changes are needed.
On June 8, 2011, senators rejected an NRA-opposed proposal that would have delayed, and ultimately killed, critical reforms Congress made to the fees merchants pay when guests pay by debit card. Deciding to stay on track with the so-called "Durbin Amendment" has provided important benefits for restaurateurs and their guests, the NRA said.
Following the June 2011 Senate vote, the Federal Reserve moved to cap swipe fees that merchants pay for debit-card transactions at 21 cents per transaction - less than the average 44 cents that merchants previously paid for debit-card transactions, but a significant increase over the 7- to 12-cent swipe-fee cap that the Federal Reserve first proposed. The 21-cent cap took effect Oct. 1, 2011.
Scott DeFife, the NRA's executive vice president of policy and government affairs, said the swipe-fee cap is helping thousands of restaurants cut costs and deliver more value to consumers, but added that the Federal Reserve's misinterpretation of the law and its final rule provided the signature debit networks -- Visa and MasterCard -- latitude to drastically increase rates for small-ticket transactions in many quick service restaurants. The NRA, along with other merchant plaintiffs, is challenging the Fed's final rule in a court case.
"What we've seen happen to small-ticket rates is evidence that still more much transparency and competition is needed not just in the debit card market, but also for credit cards and new emerging payments like mobile," DeFife said.