Battle Over Swipe Free Reform
In a newly released TV spot, NACS, the National Association of Convenience Stores, has captured the nature of an effort to repeal swipe fee reform. The spot can be seen here.
“The Big Banks, in their continual effort to avoid transparency and chase government bailouts are pushing members of Congress to repeal swipe free reform. What many people don’t know is that debit card reforms brought competition to a broken market which resulted in savings of $8 billion a year for consumers and retailers,” said Lyle Beckwith, Senior Vice President of Government Relations for NACS.
“If Congress doesn’t act to protect swipe fee reform, American consumers will be on the losing end,” Beckwith added.
Robert J. Shapiro Ph.D., an internationally known economist and currently Senior Policy Fellow of the Georgetown University McDonough School of Business, took a look at the impact of the swipe fee cap in 2013 and found consumers benefitted from the changes to the tune of around $6 billion in lower prices. And Shapiro found the cost savings supported nearly 40,000 new jobs that year alone.
Prior to swipe fee reform – which the Senate passed in 2010 by a supermajority – unrestrained by regulation or competition the card issuers were comfortable charging retailers for ridiculously high fees every time a consumer reached for his or her debit card to make a payment. Under the 2010 Dodd-Frank reform, banks have incentives to set their own prices and compete, rather than letting Visa and MasterCard fix their fees.
