As part of an effort to encourage consumers to avoid credit card debt, the Federal Reserve Board proposed a rule that would severely limit debit card purchase fees. However, it’s likely that consumers will end up being the ones paying for the lower charges.
Both the card payment processing and retail industries have spent a lot money to fight against and for the Fed’s proposed debit card rule changes, and those lobbying efforts will largely be covered by consumers one way or another, according to a report from MarketWatch. Whether prices don’t drop immediately, or financial institutions start charging more for bank services, consumers will likely be the ones footing the bill.
“Ultimately, you know that somebody is going to pay for all of this and that someone is the consumer,” said Greg McBride, senior financial analyst at Bankrate.com, told the site. “What’s best here may actually depend on the consumer and how they use their cards, as well as how the banks and retailers respond.”
The Fed’s proposal would cut the cost of a debit card transaction fee from an average of 44 cents to just 12 cents.