Thursday, February 23, 2012
Customers say retailers don't return Durbin savings
A survey of 1,000 adults conducted by Ipsos SA Public Affairs for the American Bankers Association found only 7 percent of respondents believe retailers are passing savings from recent debit interchange cuts on to consumers. The survey was released Feb. 20, 2012.
In accordance with the Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Federal Reserve determined a reasonable and proportional rate for debit interchange was 21 cents plus a small allowance for fraud prevention measures. This amounted to approximately half the old interchange rate of an estimated 44 cents. The new rate went into effect Oct. 1, 2011.
Trish Wexler, spokeswoman for the Electronic Payments Coalition, said, "Congress gave giant retailers a handout with no guarantee that the savings would be given back to consumers. The Durbin Amendment has been in effect for over four months, and these survey results go to show that retailers are simply lining their pockets with an extra $3 billion in profit."
In addition, the EPC released a field research report in December 2011 that compared prices before and after implementation of the debit interchange regulations. The research found that 76 percent of the retailers surveyed either raised prices or kept them the same after the amendment was implemented.
Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.
Notice to readers: These are archived articles. Contact information, links and other details may be out of date. We regret any inconvenience.
