Senate Democrats hoping to push through a bill approving the Federal Reserve Board’s proposed swipe fee change, which critics say could lead to more credit card debt for consumers, are facing significant opposition from some members of their own party.
A small number of Democrats in the U.S. Senate threaten to singlehandedly delay the implementation of a new rule from the Federal Reserve that would significantly cut the amount banks charge for processing debit card transactions, according to a report from the Capitol Hill news blog Politico. Several seem to have been swayed by lobbying efforts from the financial industry, effectively breaking the 60-vote supermajority that allowed the Senate to pass various consumer protections in the past.
Critics of the bill say that because it would reduce the average debit card transaction fee by 70 percent from the current average, it will cost banks billions annually, the report said.
As a consequence, some argue doing so will cause the amount of fees and rates consumers pay for their credit cards to steadily increase as banks scramble to make up for lost revenues.