Swipe fee amendment update
Increased opposition towards a proposed amendment that would limit profits for card companies is making Illinois Senator Dick Durbin modify his stance.
In an attempt to gain support, Durbin says that he would like prepaid benefit cards issued by the government to be exempt, Bloomberg Business reports. Several states have argued for such an exemption, saying that the amendment would hurt their card benefit programs.
During a hearing yesterday, Durbin said that the increased use of debit and credit card payments is making it even more important to clamp down on card issuers for their swipe fees.
“The card giants also block competition, prohibit discounts, and refuse to negotiate fee rates,” said Durbin. “If we do not take steps to reasonably regulate this system, a dollar won’t be worth a dollar anymore – it will be worth whatever Visa and MasterCard want it to be.”
Under Durbin’s proposed amendment, there would be a cap on how much card issuers can charge for transaction fees.
The proposed amendment could greatly impact a large number of Americans who use credit and debit cards. The Federal Reserve Board says that 73 percent of families had a credit card in 2007.