The Durbin Amendment Explained - NerdWallet

The Durbin Amendment Explained

Durbin and energy drink regulation: Senator Dick Durbin’s amendment to the FDA Safety and Innovation Act delivered a jolt to an otherwise yawn-inducing bill. His amendment would require energy drink makers to submit information about their ingredients and register the product with the FDA – and this provision had natural supplements suppliers in a tizzy. Durbin’s impetus was the death of a 14-year-old girl who had chugged two 24oz Monsters in a 24-hour period and suffered a cardiac arrhythmia.

Currently, the FDA can regulate caffeine levels in regular drinks, but energy drinks are considered “dietary supplements” and are therefore not under the FDA’s purview. The Durbin Amendment would require dietary supplement manufacturers to submit a description, ingredient list and label within 30 days of the product coming to market, register the product, and inform the FDA if it is pulled from the market. His eventual hope is to have an open database of ingredient information that consumers can reference, but believes that Washington lacks the political willpower to put such a database in place (he’s probably right). Durbin and co-sponsor Richard Blumenthal (D-CT) argue that if the FDA can regulate food and beverages, and consumers derive benefit from that regulation, there’s no reason that the agency shouldn’t be able to regulate dietary supplements.

Industry groups, of course, see it differently. Natural Products Insider, an industry publication, argues that tragedies like the girl’s death are caused by consumer misuse, not a lack of labeling or transparency that can be legislated away. Sen. Hatch says that the amendment “places an unnecessary product registration burden on supplement companies, including small businesses,” and would do little to improve consumer welfare.

Updated May 24, 2012The bill was defeated on the Senate floor today by an overwhelming vote of 77-20: we can continue to drink our Monsters in blissful ignorance. Sound, fury, you know the drill.

Durbin and interchange fee reform: The Durbin Amendment, a last-minute addition to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, has sparked fierce debate. It just went into effect on October 1st, and already we’re seeing its ramifications. Banks have priced Durbin into their checking offerings – that means we’re seeing less and less free or rewards checking. On the other hand, retailers have yet to lower their prices as promised, perhaps because Visa and MasterCard jacked up their rates on small merchants. One thing is certain, however: big bank checking customers are not happy.

Updated July 6, 2011: After the Durbin Amendment barely survived a challenge from Sen. Jon Tester, the Federal Reserve ruled that debit interchange fees would be capped at 21 cents plus 0.05% of the transaction, with the possibility of an additional cent if certain criteria are met. Each debit card should be able to be processed on at least two independent networks, and the rules will begin to take effect in October. This ruling is generally seen as more favorable to the financial industry than expected. For a complete rundown, check out our analysis of the Fed’s final ruling.
The amendment is rather complex, but the two provisions that are still being debated, pending the Federal Reserve’s July 21, 2011 decision, are:

  1. A cap of 7 to 12 cents on most debit card swipe fees, a decline of about 80% from present levels
  2. The introduction of competition, by giving merchants a choice as to which debit network they process transactions over. For example, present arrangements effectively force merchants to process many Visa transactions over the STAR network, even if competitors like PULSE and NYCE offer to conduct the same transaction at a lower processing price.

The provisions that are already in place include:

  1. Merchants can impose a $10 minimum on credit card transactions (this number can be adjusted by the Fed as they see fit). Previously, Visa and MasterCard banned this practice in their merchant agreements.
  2. Merchants are allowed to give discounts at the register to those who pay with cash or debit cards. Previously, Visa and MasterCard banned this practice in their merchant agreements.

Banks and credit unions are against the amendment, because debit card swipe fees mostly accrue to the financial institution that issued the debit card. Card issuing banks typically take in about 1.3% of every dollar you spend on your debit card, as a fee from the merchant. This amounts to nearly $3 billion a year of very high profit margin revenue for Bank of America, for example, a number which looks to decline by ~80% unless Congres, the Department of Justice, or the Federal Reserve intervenes.

This fee is supposed to cover the risk of fraud, transactional costs, and other overhead, but due to the lack of negotiating power on the merchant side, the fee is now a major source of profit margin at every bank that offers checking accounts. Subsequently, competition between banks has caused this profit center to be used in subsidizing free premium services, like free checking accounts and surcharge-free ATMs. If this fee were to drop to 7-12 cents per transaction, as proposed by the amendment, this would create a large wealth transfer from debit card issuers to merchants, and will likely end many free premium services at banks.

The amendment’s supporters in Congress theorize that the wealth transfer from the banks to the merchants will result in lower prices for all consumers, as competitive forces between merchants force them to pass on lower costs to customers, in the form of lower prices.

Protecting The Little Guy, Fail

The swipe fee cap technically exempts financial institutions with assets of $10 billion or less. In theory, this exempts all but 3 out of the 7,000+ credit unions. However, credit unions are aggressively lobbying against the amendment. They fear that the provision requiring multiple network routing options will make the small bank interchange cap exemption impossible to enforce. For example, Visa already promised to honor the two-tier pricing system, and would process a small institution’s transaction at the current price. However, the networks are not required to differentiate between large and small banks. Even if Visa’s STAR network offered to route a debit transaction at the “exempt” 1.5% debit interchange rate, the existence of a competitive option allows the merchant to route the transaction through NYCE instead for 12 cents.  Therefore the credit union would receive some fraction of 12 cents for the transaction, rather than ~1.3% of the transaction.

The Visa-MasterCard Duopoly

Proponents of the amendment allege that merchant interchange fees have skyrocketed relative to the cost of processing the transactions. The interchange market is largely uncompetitive: Visa and MasterCard effectively set the interchange fees for all merchants. Merchants can choose not to accept Visa and MasterCard, but this is not practical for most. The Durbin amendment’s attempt to reduce prices is two-pronged: first, the mandatory introduction of competition, and second, a limit to fees in order to correct for the market failure resulting from what is essentially a duopoly.

U.S. swipe fees are, overall, uncompetitive when compared to European countries, where anti-trust regulation has broken the chokehold of Visa and MasterCard. U.S. debit interchange fees are higher than the European Union average but not egregiously so; the true effect of uncompetitive pricing is seen in the interchange fees charged on credit card transactions, where the U.S. is by far the highest.

Most notably, the fees on some premium credit cards diverged greatly from the rest of the industry in conjunction with the 2007 IPO’s of both Visa and Mastercard, likely because of pressure to juice profits for public shareholders:

Onerous credit fees are ignored

Because of the difficulty of differentiating prices for goods based on the method of payment, merchants generally factor the exchange fees into the sticker price, or absorb the cost themselves. As a result, whether a consumer pays with cash, debit, credit or rewards credit, he will see the same price (one exception is in gas prices, where the limited number of products offered allows for price differentiation). However, merchant exchange fees for credit cards, and rewards credit cards in particular, are significantly steeper than debit card fees.

One feature of monopoly pricing is that the card network can, as much as they are able, set different prices to maximize how much it believes different groups will pay. So, for example, a Visa Signature Preferred rewards card nets a 2.5% interchange fee at a restaurant (which has little bargaining power), while a Visa Classic transaction may cost a large supermarket only 1.15% (because Visa wouldn’t want to risk, say, Wal-Mart walking away). By comparison, in France, a credit card with an embedded security chip costs all merchants 0.22% of the transaction plus 10 Euro cents, while the least secure (and thus most expensive to cover) method of payment costs 0.3% plus 10 Euro cents (there is virtually no difference by way of fees with Visa versus MasterCard). The intricacies of pricing, and the emphasis on the lucrative, oft-used credit card rewards, speak to market inefficiencies.

Are the fees necessary to fund fraud protection?

The major card networks allege that the interchange fees are necessary for fraud protection efforts, and to limit consumers’ losses in case fraud does occur. However, improving technology should have driven down the cost of fraud protection, not increased it. Jamie Henry, Wal-Mart’s director of payment services, argued that credit card issuers have deliberately kept chip-and-PIN technology from U.S. cards because security improvements would remove the justification for high merchant exchange fees. “Lower interchange would push the industry toward chip-and-PIN. We would see more financial institutions become interested in controlling fraud. It would be more difficult to pass [fraud] costs on to merchants.”

In response to proposed regulation, banks cry foul and threaten tightened credit, higher fees and steeper interest rates should the proposed regulations take effect. Some have also threatened per-transaction spending caps on debit cards, at $50 or $100, rendering debit effectively useless in paying for groceries, restaurants, or plane tickets, and driving customers toward more lucrative credit cards.

However, not-for-profit credit unions are also stalwartly opposed to the amendment, and for much the same reason: they fear that they will have to cut services or increase fees in response to an increased bottom line. They may have more substance to their claims than for-profit banks.

How Durbin hopes to ease the burden on consumers and merchants

The Federal Reserve believes that merchant exchange fees far exceed the cost of fraud protection. They further believe that the steep markups persist because the two major card networks, Visa and MasterCard, have such control over the credit and debit card markets that merchants, card issuers and consumers have no choice but to accept the prices that they set.

In order to correct this, the Fed proposed a cap that it believes accurately reflects the true cost of securing the debit cards used. If they have correctly judged the cap, banks will not suffer a loss to their bottom line, and will continue to provide the same services to consumers while merchants are able to offer better prices. They also introduce competition to previously monopolistic markets by requiring each debit card to be covered by at least two networks. However, the amendment fails to address credit card interchange fees, which are significantly higher than debit.

Although the regulations make an exception for small institutions, this exemption is meaningless as card issuers will have to accept the lowest exchange fee offered, whether or not it covers their security costs. This is an undue burden on credit unions, which are generally smaller and pay more to protect their customers.

This is not to say that the “swipe” fees are grossly overpriced, and that government reform of the market will not benefit consumers. However, the Federal Reserve must be careful to preserve the advantages offered by credit unions.

The following infographic, which we released last April, gives further details about how interchange fees affect merchants and banks:

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  • Carolyn

    Chase informed its customers via mail that the Ultimate Rewards Debit Card program is being discontinued effective July 19, 2011 due to a “recently enacted law known as the Durbin Amendment.” No further explanation of why the bank has blamed the Amendment for its demise.

    • http://www.nerdwallet.com NerdWallet

      Thanks for the note Carolyn. They may not have explained it to their users in the letters they sent out, but they’ve been very vocal about their issues in Congress and in the press (along with almost every other banking institution and credit union).

      Hopefully this blog post was helpful!

    • Akua

      Yes, I just received this same letter. I’m trying to understand what the rewards program has to do with this legislation.

      • http://www.nerdwallet.com NerdWallet

        Well banks earn money every time you swipe your card at a merchant. The fees on debit cards are typically around 1.5%, and the fees they earn are higher if you use your signature instead of your PIN for the transaction.

        Revenue from these fees are the reason Chase and other banks are able to give out rewards for debit purchases, and it’s also the reason that you only earn rewards when you sign, rather than when you use your PIN.

        This legislation, if it goes through as currently written, will severely curtail revenue from these “swipe fees,” so banks are cutting their costs from debit rewards in anticipation of the reduced income.

        • Brett

          I just got the same letter from Chase and cashed in all my points for cash

          • Jim Drass

            Can you clarify the definition of “Debit Card Transactions” as it relates to the Durbin Amendment? I was always under the impression that when I used my card and used my PIN, the transaction was “Debit Card Transaction”. But using the same card and using “Swipe and Sign” the card was processed like a credit card, and therefore technically NOT a Debit Card Transaction. The credit card transaction being a higher cost (percentage of sale) to the merchant and thus the ability for Chase to kick back points to me. Does this amendment target both Swipe and Pin and Swipe and Sign? USA Today reported that Chase was considering limiting Debit Card transactiosn to a nominal amount per day to twart this amendment.

          • John, A NJ Merchant

            Jim, yes if you use your card and simply sign for it, it’s still a debit transaction since the money is deducted from your account within 2-3 business days.  It’s not a credit card transaction, swipe and sign with your check card is still a debit transaction 

        • Airball_41

          Rewards are given on pin-based transactions as well.. Read up

      • Johndoe

        you are an idiot.. how do you not understand that. If the debit card fee that is charged is 1.3% and your reward is 1% where do you expect the reward money to come from if the fee is reduced

    • B4uvote

      And if we continue to vote for these idiots like Durbin, we can only blame ourselves for America’s demise.

  • Jared M.

    I dont know if there is anyone else out there that is as F***ing angry as me about this Durbin B.S.. Just like the previous people, I just received my letter from chase bank informing me that my debit card will no longer be able to earn airline miles with continental airlines. I dont know who the hell congress is trying to help, but ya know I always looked forward to being able to take a trip about once a year and only paying probably $175 with taxes and annual fees for a round trip airline ticket. I am broke bluecollar man that works my ass off for a misely $45,000 a year and maybe to alot out there one airline ticket isnt much, but for me it was my pot of gold at the end of the rainbow. My question is how can a simple consumer’s voice be heard to let the powers that be know that we are pissed off and not gonna take it anymore!!!

    • Luis L

      This actually helps merchant to not get charged so much on fees, there for allowing them to lower their prices

      • Scott

        All these new credit card laws only hurt the middle class and help the idiots of our society from doing themselves harm. When Chase bought out WAMU, they stripped my card of all its benefits and doubled my APR to 22% for being a loyal, never once late customer of 7 years. The Rich get richer and the middle class gets smaller and smaller.

      • Leah

        That’s the thing, do you really think merchants would lower their fees because of it? I’m pretty sure they’d just enjoy a higher profit and not pass it on to their customers.

        • Jose

          Even so thy would have more money to spend. A vast majority of the economy is made up of small businesses. They would have more money to grow and to hire more workers. If they are close to their workers, as many are since most small businesses are made up of around 5 employees, they will probably give them a raise. In the end there is more money in the hands of the working class which they can spend to increase demand on products which will create even more jobs. The rich have to understand that keeping all their money is worthless. If they give money to the people it is bound to come back to them because the people are gonna spend and buy a buch of stuff that make them happy.

          • Lemons

            Do you honestly believe that small businesses will hire additional employees because they saved; on average; $0.55 on a $50 sales ticket. Get real. If my bank caps my debit card limit at $50 per transaction I would no longer be able to buy groceries, gas or restaurant dinners with my debit card; I would have to use cash because no one takes check any longer and I’m sure the only way to withdrawl cash would be ATM’s with higher fees. This will kill the ecomomy by limiting the amout that comsumers put back into the retail world.

      • MaryC

        Maybe so, but I needed those miles now. I too have Chase debit card with Continental miles. We were planning on using it up to August when I purchase tickets for our bi-annual trip overseas to see my husband’s parents. I think we’ll just squeak by with enough miles but this is how we’ve gone to see them for the last 8 years, this really stinks. I’ll be calling around for a new bank that has a rewards program. I hope they don’t cut the Disney Rewards program now too.

      • Terry R

        Don’t take this the wrong way but merchants won’t be lowering their prices and those of us who actually found value in the Visa Rewards Program are bleep out of luck. Like Jared M. I’ve cashed out several times through the VRP and got some valuable things back like $400 gift cards to Best Buy, a very nice digital camera and more. As usual, Congress has found a way to cover its own ass and look good in the headlines all the while screwing the consumer.

      • Mike

        In theory, in practice, it’s going to hurt the consumer, because our prices will stay the same, and the stores will keep what once came back to us in the form of rewards.

        • Richard

          Why is it that keeping my full price for goods and services considered a “reward?’ 

          Why can’t you people see that using your credit/debit card is like TAKING from me so that YOU get a “reward”?  If my prices weren’t fair in the first place, no one would shop here.  But you think it’s OK that I should take an additional hit so you can get a free toaster or half-off at some other business owner’s establishment!!

      • Fwinters

        What about the consumers? I like to earn miles for my purchases!!! F**** all of the Durbins’ I’ll bet he makes enogh so he can pay for airlines tickets ! .
        In Hawaii I pay $4.39gl and what used to be $32.00 max to fill up is now $59.00 ,

        I thought… ok is bad….. but at least I’m getting miles !
        now I still pay the same amount for gas and probably more when summer comes and NO MILES!!!
        WTF FML

      • Trix

        “allowing” them to lower their prices does NOT mean that they will……. lets be real.

    • Richard

      Lay off the cigarettes and beer, save your money,and take a trip on YOUR dime.  I’m a business owner who is paying $800- $1000 every month because you and others like you don’t want to pay cash.  Why should my hard work fund your vacation?  I haven’t had more than a few days off here and there in years…..let alone a merchant-paid-for airline ticket.

  • Victor R.

    I work just as hard as you do and I’m tired of funding your airline ticket. I never raise my rates and cannot do to the economy or I will lose business, yet I have to pay high credit card transaction fees every month because of your “pot of gold”. Not to mention I just got a letter saying my rates are going UP! I don’t understand why my rates would be going up AND they are canceling your rewards??

    • Jared M.

      Well Mr. Victor I am sure you work hard too, as the rest of America, so i wasnt saying i am the only guy that works hard, but this whole situation sucks for everyone. If they can give rewards to the non business owner, why cant they give some kind of reward to the businesses that provide us the transactions to get the rewards? I am sure you wouldnt mind a little pot of gold yourself correct? We gotta fight them, not each other. Or we will never get ahead and this economy will stay in the gutter.

    • Matthew Sr

      Mr. Victor,
      As a merchant service provider / processor I see a lot of benefits to this Amendment. Consumers may be upset about the loss of rewards but in turn they should see lower prices for goods; a much more rewarding “pot of gold.” As a provider I do not need to pass on these lower fees to my current and future merchants, but there are providers like me out there that aren’t greedy. Past and future merchants that process through me will now receive a cost plus program to receive the great benefits associated with this Amendment and be able to pass this reward on to their customers, thus being more competitive in their marketplace. I can accept a monthly residual of $20-$50 depending on volume and have a business owner’s loyalty for a long term rather than make a bunch of money for a short term and keep working my butt off gaining new business.

      Of course I need to add my sales info…but seriously if anyone is interested in checking out my cost plus program to be prepared for these changes and to save money as a whole on current fees, please contact me and we’ll work out a great relationship to greatly benefit both of our bank accounts! Email me at MidAtlanticbusinessSystems@gmail.com.

  • http://www.nerdwallet.com NerdWallet

    Hey Jim Drass, to answer your question, debit card transactions with respect to this law include any and all transactions that take place with a debit card, regardless of whether you sign or use your PIN.

    Even though the terminal says “charge as credit” or “charge as debit,” the payment network actually differentiates them as “signature debit” and “PIN debit,” respectively. You are correct that signature debit incurs a higher swipe fee than PIN debit, which is why the companies are able to pay you rewards for signature purchases.

    But this is entirely different from actual credit card transactions, which incur much higher swipe fees than signature debit. This is why credit card rewards programs tend to be much more lucrative than debit rewards programs.

    The fact that only debit cards are ensnared in this proposed rule is a major oversight on the part of Congress, since credit card fees are so much higher.

    • Airball_41

      PNC gives Points for both deibt/credit transactions.  Not just credit

  • Eric

    Great article summing up the Durbin amendment. I too received this letter from chase today and felt compelled to research this amendment. I can understand both points of view on this one. I now realize why small party stores have a $5-10 minimum on card usage.
    This is the U.S. government after all thinking they know whats best, so the odds of us ever noticing a decrease in prices is slim and now their are no points earned on purchases. Kind of a lose – lose situation for the consumer. Good thing i just cashed in my points for $200 to cabelas.

    • Matthew, Sr.

      Eric,
      The Durbin Amendment actually includes the capability for merchants to impose a $10 minimum on card usage at the most. Currently it is illegal to impose such minimums, however most mom and pop shops have signs displaying a minimum. As a processor, I see these concerns and the best position for these businesses is a no transaction fee tiered program, but once the Durbin Amendment is implemented they would not recieve the benefits of it’s cost limitations on card issuers. This is definitely where businesses with a very low average ticket would be in a bit of a bind and truly want a $5 – $10 minimum on purchases using cards.
      I know as I’ve been educating business owners on the positives and negatives of this likely new law, they feel they would pass on these savings to their consumers to draw in additional business as they would be highly competitive in their prospective market. The average business with an average ticket under $50 is likely to save $200-$400 in monthly fees! My local pizza/sub shop doing $20k monthly processing volume should save about $330/month based on their current debit volume! They look forward to dropping all their prices to greatly compete with the Dominos and Papa Johns type businesses in the area.
      I hope the Debit Interchange Fee Study Act is avoided over the next month!

      • http://www.nerdwallet.com NerdWallet

        Thanks for the note Matt! Just to clarify, however, it is currently legal for stores to set a $5 – 10 minimum on card purchases. This was part of the Durbin Amendment that was passed into law last July. It’s also now legal for them to offer discounts for cash, check, or debit purchases.

        The only part of the law that is still open to debate is the actual regulation of debit interchange fees, which the Durbin Amendment mandated the Federal Reserve to deal with. Right now we’re waiting to see what the Fed decides, or if their decision is delayed by the Fee Study Act.

        Even if the Fee Study Act is passed, merchants will still have the legal right to impose purchase minimums and offer discounts for other forms of payment.

        • Matthew, Sr.

          Thanks for the info! I’ll be sure to tell merchant’s that part of the Amendment was already in effect and can implement a minimum. I hadn’t read that it had already passed certain parts of the law. I’m trying to educate myself the best I can and your site certainly has helped quite a bit!

  • crystal

    I am excited about this. My daycare stopped taking debit/credit cards because they had to pay $190 a month to visa (there are only 7 kids at my daycare), the convenient store down the street charges me 45 cents everytime I use my debit card (twice a day). Its ridiculous! This may even lower the cost of some goods because stores are not paying a% of their sales to “Visa”. Yay!! Screw the rewards program I have from chase! I never got anything from them in the past 5 years anyway!

    • Outhouse

      If you had used your Debit card as Credit then you would have gotten all sorts of things… I got luggage, Starbucks cards, Ruth Chris Steakhouse gift certificates,etc.. all fot just making a purchase that I would have anyways but swiped as Credit not Debit. Thank you Congress for screwing us again.

    • HayHay

      Wow…excited? Really? I dont think you understand…the credit card company will still gets their piece of the pie…this just allows the merchant to surcharge the consumer for it instead of eating it…so what your convenient store was doing to you that you think is ridiculous could become the norm. This SUCKS for me…I don’t carry cash anymore and pay 99.9% of my bills online with my debit card…now I’ll have to revert back to carrying cash and paying bills with paper.

  • george

    Chase posted a 17.4 billion dollar profit for 2010. Yet they cut out the Rewards program. Banks are there for one thing: to make as much money as possible. They will do it anyway they can. They will cut services, reward programs, labor, whatever. In the branch in the French Quarter in New Orleans I have never seen more than two tellers at any one time. Seems they poor mouthed their way into a 17.4 billion profit.

    • Anonymous

      So why does it bother you that banks make a profit?  How much profit is ok for them to make?  Why exactly are profits so bad?  If you think a bank is making too much money, or don’t like that they cut a service you like, you’re free to do business with another bank or use cash.  If you want in on that pie, start your own bank.  But you and your socialist idols in the government have no right telling any private entity how much they can charge for their product.   If you actually produced something (unlike most democrats), would you be ok with government telling you how much you can charge for your product and how much profit you can make for all of the work you put in?  

      • Pentagontrailer

        Profits are not bad. But when to few people have to
        Much power as in the dualopoly of visa mastercArd then the market
        Gets manipulated and….

  • MANNY

    The cash back rewards for using your debit card as a credit transaction was nothing more then a kick back for helping banks stick it to merchants and it was a pitiful kick back at that !! Why mercchants did not fight fire with fire by offering their consumers with discounts for using cash or a debit transaction ? If its true that the admendment do not cover credit cards then there is a big hole in this whole reform. But most likely a compromise was made for the little bit of reform that was attained. Oh, and don’t start crying for the banksters because they still have much more fees under their sleeves to charge us.

    • Pentagontrailer

      The reason retail didn’t fight back by offering discounts to cash customer
      Is because visa/MasterCard made that a breach of contract in the
      11,000 page document retailer’s had to sign to get the service.

    • Jay

      Type your comment here.
      Dear Manny: I have business with 10 employees. I accept visa and master card because I have to, otherwise will lose some of my clients. My average tickets are $15.  There is no practical way for me to offer discounts to cash customers.  Were it really hurts is the reward cards.  I have no way of knowing what percent I get charged for reward cards (up to 5%) until I get my monthly statement.  For my small business with a volume of about $20,000 per month, I pay $600-700 per month on Credit Card fees.  Since customers like to add th tips on the card, I also end up paying percentage on th tips my employees charge.  Henry Ford, once said; if people find out what laws the Banks pass in congress, they would revolt.  I guess people don’t know yet.

      • Kristy

        Hi Jay…
          Your effective rate is high. Part of the problem, a big part, is the “Processors” costs. Although a rewards card does charge a higher rate, it is set by Interchange at no more than 1.95% + .10, if you are paying 5%, it is because the processor is hammering you on a “Non-Qualified” surcharge. The processors are paying kickbacks set by the brokers you use to set-up your accounts as well. there is so much excess in this system it squashes the small business.
          I am a financial analyst, and set-up processing accounts, direct to the processor, without a broker/bank margin added in, and to be honest, the difference in “Processors” cost, is averaged at 65% lower.

          To any business, do your homework, dont just make your processors lower their fees to offers made that are lower… it may seem easy, but they raise them again to make up for the loss, and it is letting them know they can continue to excessively charge without penalty, “we will charge em fairly when they catch us” ideology.

  • ann gutierrez

    We the consumers are getting tired of getting screwed by BIG BANKS, BIG BUSINESS, and
    BIG BIG GOVERNMENT. We have two HOUSES ON THE HILL, THAT ARE CORRUPT,SO WHAT DO WE DO ABOUT IT “AMERICA”?

  • MANNY

    Alert !!!!!!! I just received an e-mail from CHASE that the vendor , Epsilon , they used to send out their e-mails to Chase customers had their files on Chase customers e-mail addreses stolen !!! So please be careful in replying to a CHASE E-Mail. Verify the e-mail with CHASE before sending any info on line.

    • Melissa

      That Epsilon Company is apparently the hub for many email address info. I have gotten 3 letters now from 3 separate companies with that exact same info.

      The Merchants, they are not going to lower prices because they are not paying as much in CC fee’s, that’s a load of bull. Banks were attempting to offer something, if the merchants are having that big of a problem, make a min charge fee or payment retirement for your store, or like one person said give people incentive to pay another way.
      If the banks are going to do it, we are going to bite. We all want some sort of reward, especially when you are counting pennies to survive as it is. So instead of bitching about consumers being greedy with their benefits, do something to make consumers happy yourself. Banks are a billion dollar industry and they are all a bunch of thieves so we take what we can get when we can get it. And we will have you, Victor, and anyone else who is a merchant help us buy our airline tickets or what have you just like it has been done for, what, at least 30 years now getting rewards from buying stuff from you with CC’s.

  • Scott

    I received the same letter from Chase Bank for my Business Rewards debit card. As a business owner, I’m well aware of the fees for accepting plastic. Until I recently switched processing companies, you needed a spreadsheet to figure what the actual cost were when you accepted credit. Rewards Card, Business Cards, Business Rewards, etc. Debit cards used to be processed at a flat fee, when I started accepting them years ago. I was charged .55, irregardless of whether it was $50, or a $1,000. A few years back, the rate crept up to a little less than 1%. This was still cheaper than accepting any credit card, but…

    Somehow I’m skeptical of anything the government is doing on my behalf to benefit me, as a consumer, or small business owner. This reeks of the credit card act of 2009, which was supposed to benefit all of us. The credit card companies(banks) had ample warning of this, and they sent out letters informing good customers, as well as the high risk customers, that their rates were due to go up. Actually the person who should not have had a card in the first place it probably decreased their rate, at my expense. What it did for me was increase my interest rates and I now have an annual fee. One of my business credit card companies got out of the game. As you are probably aware, they can change the rules at their whim, and solely for their benefit. All that is needed is to notify you of the changes. Yeah, we had a problem, but who issued the cards to high risks in the first place? Um, tell me again, how this was for my benefit and not the banks.

    Oh, and seeing as we’re talking about Chase, which used to be WAMU, in my case…What about the free checking which is no longer free.

    To get back to the matter at hand, this will not benefit consumers, or small business, but banks and large companies. The banks, don’t lose. And even when they do, as in their poor decisions and greed, they don’t, because after all they’re too big to fail and they have the money to grease the political wheels of this country. IMHO

  • Fred Freshytepore

    How about we all go back to using cash and cut the banks out of the equation? What’s wrong with having a few green bills in your pocket? It has a built in privacy factor as well.

    • Dustin

      yeah and so safe and easily traced if you get robbed and have a way for you to get your money back in such a circumstance…oh wait..that would be credit/debit cards, not cash

      • Laurence

        And cash is much easier to get quickly.

    • Makin1952

      cards have replaced cash, you’re a little late with that idea Fred 

      • Laurence

        Cards have replaced cash? Haha . There are enough card problems that I keep enough cash I don’t have to worry about some network or machine being “down” or a purchase where cards are not accepted or a deposit or transfer i9s held up x business days. If cash is replaced it will be by unlawful force.

  • Pat

    Here’s an idea–use cash. Government trying to “help” the little guy almost never actually works. Everyone hates the super rich, but it’s government programs like these that help make those people untouchables.

    Cut VISA and Mastercard to their knees with anti-trust legislation and bring in 15 other debit card competitors. Let them all charge what ever fees they please for the use of their cards and let them charge whomever they choose (merchant or consumer). Put the consumer in charge of deciding which company gets their business and which do not… THAT will help keep honest people honest. Not this government control of banking garbage!

  • harry stogsdill

    its all about making this a one world economy. now were back to $4.00 a gal. for gas and its going to stall the economy again….not that it grew much in the first place. lol and ya just got same letter from chase. f em, im going back to cash! theyre too hard to deal with in the first place. they can blame a durbin agreement all day long. im done!

    • Anonymous

      Economy didn’t grow much, but the people who look at the dow and see 12.5k say we’re almost back where we were!  Nevermind the dollar lost its value and all of the stocks are bought and sold in dollars… those minor details don’t count, haha.  

      I think people and corporations need to have the freedom to decide.  Honestly, a merchant should display the price, the taxes (calculate all of the corporate taxes involved into the price of each item) and all of the other fees… if people buying a tv don’t like the fees Visa would be collecting on the deal, they can pay with cash.  If they don’t like the corporate taxes the government collect for letting that tv come from Japan, they can vote someone else in at the state and/or federal level… if they don’t like the sales taxes, they can vote different state/city people in, and so on… but if everything is hidden in the price, the consumer will always blame the retailer, or whatever big corporation of the day that dares post a profit (we all know, profits = bad!).   How the socialists managed to demonize success so badly, I do not know…

  • http://www.creditcardprocessingbook.com Bill Pirtle

    Dick Durbin is wrong about Interchange fees. His amendment will only help the largest retailers and some association members and force up costs on consumers.

    Only businesses that will benefit in the short term will be those businesses on a price structure called Interchange Plus pricing. Most businesses are on a Tiered pricing structure, that is not based on Interchange.

    If you see Qualified, Mid Qualified or Non Qualified on your statement you will not benefit from the Amendment.

    I have a free eBook just released Tuesday called Dick Durbin is Wrong: Errors Behind His Amendment to Dodd-Frank. It is available https://www.smashwords.com/books/view/51629.

    I also released a book last year fully explaining card processing, finding a local agent and avoiding processing scams titled, Navigating Through the Risks of Credit Card Processing.

    Since banks will find ways to recover fees and businesses will not reduce prices, we consumers will be paying twice and that will cause a deeper recession. So even the few winners of the Durbin Amendment will lose in the long run.

  • U4mepd

    This is NOT FOR THE LITTLE GUY!!! This once again is for the GREEDY COMBINED GOVT. CALLED THE NWO!! BUSH, RUMSFELD, CHENEY AND ALL THE BIGGEST BANK OWNERS IN THE WORLD!! Just like gas prices are sky rocketing because of POSSIBLE fear of a gas shortage.. Just like 911, just like the EXACT OFFICE THAT WAS TAKEN OUT AT THE PENTAGON THAT CONTAINED ALL THE INFORMATION ABOUT WHERE THE 13 BILLION DOLLARS THAT WAS MISSING FOR THE US MILITARY THAT RUMSFELD COULD’NT EXPLAIN!!! JUST LIKE ALL THE WEATHER BALLOONS THAT WERE REALLY UFO’S , BUT MORE LIES LIES LIES FROM THE GOVT. BUT WHO ARE WE TO STOP THEM? AND THEY KNOW WE CANT STOP THEM!!! WHATEVER THEY DO, WE HAVE TO EAT!!!!

    • Sunny

      Wow, if that isn’t victim mentality! Wake up and realize that there is no “OUT THERE”. Each and every person is responsible for what is in there life, period. You want to focus on all that, be my guest. You are only bringing more of it to you. Why not focus on what you do want? Test it. You will start attracting the things you do want to you. Remember, thoughts become things. Choose the good ones. It doesn’t hurt, and it sure makes life easier, and happier.

  • Rkjones

    What the hell?! My rewards program is done as of 7/19/11. I use my points for lots of things. Thank you, Congress, for interfering in my life once again! Appreciate it.

  • Anonymous

    Unbelievable, just got a notice from Chase Bank – my rewards program is over starting July 19 because of Durbin. As a small business we really came to appreciate it. Why is it everything the Democrats do hurt the people that actually produce? It just never ends, 2012 can’t come soon enough.

    • Farmerwannabe

      what do you mean starting over?? They are done with!

      • TinaBambina

        He said “over starting July 19” not “starting over”

    • John

      Agreed. This is hogwash. Thank you Dick Durbin.

    • Maystar78

      Like the republicans don’t hurt us too.  Every thing politicians do hurts average people

    • Eatshit

      I just received a notice from BBVA that my rewards program is ending also!

      • Jhonvanwagenen

        Bank of Montreal just bought out M&I (Marshall and Isley) and promptly ended our rewards debit card

    • Terry

      TCF Bank canceled theirs, too.  Just got the letter yesterday.

  • Darkhorse

    U4mepd the men in the white coats are coming to take you to a happier place.
    For the rest of us that actually reside on planet Earth…. Democrat (aka socialist) Dick Durbin is just doing what all socialists do. If you don’t play their game then you’ll win. The banks were charging what the market would bare. If the market didn’t want their service then they wouldn’t have offered it. Socialists think they can tell anyone what they can do in any situation. We the people elected them and then realised that they are not acting in our best interests. We threw the bums out of the House and partially in the Senate. If you don’t like the “wonderful” socialist life style that Democrat (aka socialist)creeps like Durbin want to bring you then there is a unique thing called an election in November 2012 that We the People can use to throw them out and get our economy and country back under Our control. Or we can let the European Socialist’s (who by the way, also don’t have our best intrests at heart) to influence our politics. Demcrats take your party back. Be the great populists that you once were again.

    • Maystar78

      Far cry there on the democrat/socialist thing.  If you had your way half of us would be living with nothing while the other half lives high on the hog.  The market doesn’t care, the little guys drown and the rich get even richer, and no political party or politician  gives a damn about me.

  • http://www.nerdwallet.com/ Tim

    Hey guys, those of you who lost your debit rewards to Chase – you may want to call them and see if that has changed.

    The Fed is dragging their feet on making a decision, and Congress is trying to push the regulations back a couple of years, so Chase has announced they are reinstating rewards until they get a better idea of what’s going on:
    http://www.nerdwallet.com/blog/2011/chase-revives-debit-rewards-program-durbin-amendment-delay/

  • Farmerwannabe

    How are these fees any different than how we use Paypal, Dick Durbin, you gonna change that too??

  • art

    Banking is a BUSINESS not a government service! The fact is, merchants make more money(more sales) with credit/debit cards. The merchant doesn’t lose money from swipe fees. Most likely these transaction would never even take place if it were a cash only business. So to say merchants lose money from credit card purchases is wrong. Government needs to stay out of the business of business and do what they do best…What do they do best?!

  • JRT

    Banks are canceling their airline rewards programs because of this amendment. Why?

    • rob

      Read the article

  • Farmerwannabe

    My view if you don’t like the charges that come with accepting debit/credit then don’t accept it! When I worked I could not use my cards if I wanted a discount on goods, and my husband who worked at Target was the same way. We were fine with it, why aren’t merchants? It is the price you have to pay to get the sales of those people wanting to use plastic.

    Paypal is the exact same way, if I want to accept a credit card payment I have to pay a percent to accept that payment, well I have because I wanted that persons money. It is the SAME thing.

    Sears just got me to purchase a $2000 riding mower because of my Disney Rewards card, now once that is gone they won’t get my business anymore because I don’t shop at Sears often. Maybe these merchants need to thank Dick for me not shopping there anymore.

  • Mewinfield Winfield

    If this comes to fruition then I will not use my debit card at anyplace that charges a surcharge. Also I received a notice from my bank that the rewards program will cease after 7/1/11. I feel this is unfair and leaves n0 incentives for the people. The biggest incentives to use a debit card were that the money was paid out of your bank account and that you could accrue rewards. Well as it stands, I feel that people should resort to putting their money under their mattresses. At least they won’t lose any face value to greed and fees.

  • http://twitter.com/financeguy74 brian mcdonald

    Finally an article that posts what happened in Australia. In image #3 above, it shows the annual fees that increased as a result of debit card fee reform. It’s pretty astonishing. http://www.merchantprocessingresource.com/apps/blog/show/6740210-interchange-regulation-and-reduction-proof-it-will-fail

  • Toadshorts

    As a former banker I could never agreed with the banks who wanted to be in the credit card business in the first place; it amounts to nothing more than an unsecured loan. The debit card, on the other hand, makes perfect sense. Since it replaces checks, the merchant knows instantly if funds are available. However, fraud has loomed large over the years, spoiling the convenience of plastic for all honest people. A picture ID on the card is a great help, although nothing will stop a very determined crook. Abolishing credit cards altogether would go a long way towards eliminating fraud problems. Debit cards, on the other hand, have a lot going for them.
    The Durbin Amendment is a good idea gone bad. Too many unintended consequences.
    BTW — Don’t get too sentimental over Credit Unions; they, too, have shed most of their original purposes and now operate full-fledged banks under a less-restrictive set of regulations which result in unfair competition. Just about anyone can have an account there.

    • lovemycu

      Credit Unions have not shed their original purposes, they are still for their members. I work for a small credit union and the Durbin Amendment will hurt us and our membership! Since you are a former banker you must not be aware of all the regulation/compliance changes that we are being inundated with from the government, we have always been regulated and we follow the rules and regulations. We offer free checking to our members, free overdraft protection, lower interest rates and unlike banks the profit is returned to the members through higher dividend rates and lower loan rates. We are paying for the sins of the poor underwriting and unethical behavior of the BIG BANKS and Mortgage Brokers, we are being slapped with so much additional regulation because of the practices that they instituted in their free reign period under the past administrative regime when we were doing things by the book!

  • willy

    Just so you know , the rewards program from CHASE is one of the best out there, no other financial institution lets you get debit rewards for almost all of your purchases, unfortunately due to this amendment Chase will be removing the “DEBIT REWARDS PROGRAM” as of July 2011 only. Until further notice. So if you get rewards points from your DEBIT card, as of July you will no longer be able to accumulate the points. Point will not expire and as well if you paid an annual fee for the program, Chase is refunding some of that back. Finally, The Chase Freedom Credit card is by far the best rewards card on the market. No annual fee and you can get up to 5 points per dollar. So if you like rewards points try getting the Freedom card, and you can also combine your current points from the debit, to your freedom. Chase as well as other banks are businesses and they are there to make a profit weather we as consumers like it or not. I went to my branch last week and they helped me out with this situation. I recommend that if you got Chase, visit them, they will help.

    • Johnny Laydown

       It sounds like you work there… I’d like to see your response come August when they CHASE your points away :)

    • Airball_41

      Actually Chase does not have the best rewards programs. PNC Bank offers 6 points per $1 and it takes less points to get the same item or ticket from Cahse Bank.  PNC still offeres Points on their Checking accounts as well.  I encourage you to do some research before posting.  This comes from someone you worked at Chase during college and still banked somewhere else.

      • Farmerwannabe

        Airball you must be an airhead and doubt you worked at Chase because Chase has a rewards program!!!  I have $96 in rewards dollars as of right now and it is through Chase Bank debit card!!  Maybe you need to do research before posting!

        • Farmerwannabe

          clicked too soon.  I would rather use that bank vs PNC any day because of the fact PNC owes me $60 of money they lost!!  Secondly you have to look at the fees involved, I since I have kids would rather have Disney points for a vacation than to buy $100 worth of products.  So maybe I need to retract what I said about you being an airhead as I figured you have kids.  My apologies.  this thing needs an edit button..lol

  • John, A NJ Merchant

    There is a problem with NerdWallet’s argument that routing between STAR and NYCE would allow a merchant to avoid paying the exempt-issuer interchange rate.  What a merchant pays is a combination of both the interchange fee and the network routing fee.  These are the two separate charges related to debit processing that a merchant pays.  The exemption for small issuers that exists means that regardless of whether a transaction goes over NYCE or STAR, the issuer would still get their exempt interchange rate.  The only benefit of network routing is that the merchant can steer to the network that offers the lowest routing fee, but they can’t steer to lower the interchange rate. 

  • Maihelwani

    WHY DON’T YOU JUST LINE US UP AND SHOOT! PUT US ALL OUT OF OUR MISERY! WE WORK HARD FOR OUR MONEY AND ALL THE GOVERNMENT KNOWS HOW TO DO IS FIND A WAY TO GET EVETY LAST PENNY! GIVE US A BREAK ONCE AND FOR ALL! 

  • Maystar78

    Cry all you want, they’ll get us one way or another regardless, no matter who “they” are.

  • EL

    I was really divided on this issue. But after researching the problem – I am ultimately led to the conclusion that the vendor, VISA and MC should be able to charge whatever they want. If you dont want the service, then dont buy it. No one os forcing the store owners to accept credit cards.

    I dont think government intervention is right in this instance.

    • dissturbbed one

      Did you really research this? you must take into account the unfair business practices visa and mc have used to get where they are. The day they screwed their competition is the day they let in the government.

  • upset consumer

    Are the retailers going to pass the savings on to me.  I don’t think so.  Lets see, my frequent flyer miles and other rewards will go away, my totally free checking will no longer be totally free, and I am sure I will incur other bank fees.  All this thing will do is enrich reatilers at my expense.  I am against it.

  • Drowning in Fees!

     As the owner of a small retail store, this is a tiny step in the right direction. In the fiscal year 2010, I paid the equivalent of 4.5 months of rent in processing fees.  Processing fees totaled 3.32% of my gross revenue. Since my industry (tobacco) has seen huge tax increases, my profit margins have dwindled down to under 20%. Since we are in Chicago, sales tax here is 9.75%. This means that I have to make up the processing fees for the tax collected out of my profit. That’s three cents on every dollar collected in sales tax ( If I collect $3,000 in sales tax per month, that’s $1080 per year).  That may not seem like much until you break down that eighty cents of every dollar collected goes back into product. The remaining twenty cents must cover rent, utilities, insurance ( liability and health), alarm, advertising, payroll, payroll taxes, processing fees, etc..

     My biggest issue with this bill is that it may address transaction fees, but there is also the percentage of the transaction in addition to the transaction fee. These fees are between 1.7 % on the low end and 4% on the high end. This is for credit cards or non pin based debit transactions. Pin based debit is a flat fee of 25-50 cents.

    In my 20 years of retail, the split between cash/credit,debit has gone from about 50/50 to almost 20/80. Yes, almost 80% of my transactions are now credit/debit.

  • Lancexavier78

    Fuck you Durbin Fuck you

  • Bill

    Nerd wallet seems to make the businesses out to be the bad guy. When the businesses has been paying out of our profits for years for card users to use plastic. Why do you not take it out on the banks, that has been charging high fees to the retailer. If you own a business, you do not have your markup set it to incur the swipe fees and percentages of purchase fees.  The business just had to eat the cost to take the plastic.  There is no fee for using cash. Just a thought!

  • http://twitter.com/merchantaccnts MerchantAccounts

    This is a fantastic breakdown of the amendment and its real world consequences

  • Travelwithnina

    Has anyone found a replacement for the Chase Continental Rewards debit card? Are any banks issuing debit cards with mileage besides PNC?

  • Joe

    I love it……..Im a merchant processor………Chaching……More deals

  • Redmaryed

    I am not thrilled about the Durbin Amendment. I had a wonderful thing going with my ARCO debit card. I buy all my gas at ARCO because it is generally the cheapest, plus I could use the card anywhere, and I was never charged any transaction fee. Yesterday I received a notice saying the debit card program was being cancelled due to the Durbin amendment. Since ARCO doesn’t accept credit cards, I ‘m going to have to carry cash now to fill up. Once again the government screws the little guy…thanks guys.

  • Makin1952

    I walked out of  a favorite restaurant because they stopped taking credit and debit cards.  Its part of doing business and businesses with a brain, add the cost of processing into the cost of doing business.  Not thinking they will drop prices because Big Government sets a lower rate.  In fact, government needs to stay out of the way as they confuse more than they help…..

  • hello there

    Fred I agree with you.  If it were’nt for all these people using cards there would be no such thing as identity theft!  There would be no such thing as people maxing and losing everything they own because of a piece of plastic.  Cash only!!!! best way to go.  If this country ever stops accepting cash we are in really BIG trouble.

    • clerk

      Oh yeah, we should all start carrying around large quantities of cash. That is the answer. Now you can live in fear of being mugged even in the best neighborhoods, because criminals will know there is cash to get. You’re a moron hello there.

      • Face

        this ones to u, CLERK….how did people ever manage to make it in the days before debit cards?? debit cards are a relatively new thing…..that’s where the old “hide your money under your mattress” mentality came from….the real criminals are the banks..so YOUR the MORON

      • samantha gardner

        The bottomline is there is no answer to this. The bible tells us what we are headed for and how it ends. Those that choose to believe in GOD and the bible know this. This is freedom of speech at its best.

      • Ricknmo

        i would rather have some cash stolen from me than access to my whole damn bank account ………gee who is the true moron you idiot !

    • Unity

      Yes, yes, yes to cash! And thank you to the Durbin Amendment, because us cash, check & debit card users have been subsidizing credit card users on average $150/year in increased merchant prices due to swiping fees (according to a 2010 report by the Federal Reserve Bank of Boston). Basically another example of money flowing from the people to the banksters & corporations, in the on-going heist perpetrated by the Federal Reserve, the banks, and the credit card companies. As merchants drop their prices & only charge surcharges to card swipers, this imbalance will even out. More money to the small businesses, more money to cash & debit users, less money to banks & credit card companies.

      Those who live in true abundance understand credit cards are not “credit” at all, but rather debt or “debit” cards. Debit cards are truly “credit” cards. The banks conveniently reversed the wording to confuse the people. Debt will never equate with true abundance and those who live by the Universal laws of abundance choose to live without debt of any form, paying for all services and goods with true energy – money, goods, or services actually in their possession, rather than fictitious money granted through credit card and loan services. No need for fraud protection or burglary when living in true abundance, as the Universe honors those in integrity, who continue to circulate the flow of energy (money, goods, etc.) and give freely of their excesses (money, service, goods, etc.). Credit cards are illusion. Paying with borrowed money is illusion and stagnates the flow of abundance into one’s life. As the message one sends to the Universe when occurring debt is one of scarcity, not abundance. By choosing debt, we reinforce the belief the Universe is not abundant and we are not worthy of having our needs fulfilled, while continuing the fear that there is not enough. The Universe is abundant, all the needs are fulfilled, and there are always plenty of resources for all of our true heart’s desires if we are open to the true flow of energy through our beings. Choose cash (or another form of currency in use in your area – anything based on real human energy, not borrowed or fictitiously created energy), choose generosity, choose true abundance & this world begins to flow in true harmony once more.

  • Kristy

      I have seen a post by one expert that says as a result of the Durbin amendment, merchants may be able to break their contracts with a current provider to negotiate or obtain better rates from processors ? Has anyone else seen that ? Most contracts carry heavy penalties, and as a consultant I know many being held hostage by long and expensive contracts.

    • Igotcreditcards

      Merchants are always allowed to change processors. The contracts you speak of are not contracts, but cancellation fees. This so called contract is a scare tactic probably because they are over charging you, scaring you into staying longer. Cancellation fees can be expensive in some cases, but if your new processor is able to save you hundreds of dollars monthly, then it may be worth the switch in the long run. On average merchant services (processors) have a three year cancellation fee charging you 25 for every month you have shorted them. I.e you have been with a processor two years and you switch to a better company with one year left on your cancellation fee. 12 months multiplied by 25 is $300. Your new company is able to save you $150 a month, then two months later you start your saving. If you have anymore questions or want a legitimate processor with a great reputation (A+rating Better Business Bureau) retention rate (95%) and access, email me at igotcreditcards@gmail.com

    • Zavarybrothers

      The merchant will be saving so much money they will be way ahead to early terminate their contracts if they have a tier program.

  • Miss_C

    In my “Walmart-is-trying-to-destroy-America” conspiracy theory, I would like to point out an overlooked statement in the article above, “Jamie Henry, Wal-Mart’s director of payment services, argued that credit card issuers have deliberately kept chip-and-PIN technology from U.S. cards because security improvements would remove the justification for high merchant exchange fees.”
    So Walmart sues, and the result is that we now have the Durbin bill.
    Walmart has made it practically impossible for goods to be manufactured in the US, and now everything is made by underpaid workers in China and sold in Walmart’s for whatever price they choose. Now they don’t like the credit card fees that they have to pay, and now the entire gets to subsidize Walmart because everyone now has some new bank fee to pay that they didn’t previously. There are 3 Walmart Walton’s on the richest people in the country list.
    I’m not saying 2 + 2 equals 4, but think about it….
    Don’t even get me started on the banks.

  • Miss_C

    Correction: according to Forbes top richest in 2011. there are 4 Waltons on the list. In the top 11

  • Anonymous

    As far as I’m concerned, you can keep you stupid plastic. I now cash my checks, leave a small amount in the bank and pay for everything with cash or money orders. My greatest fear is that some day plastic will outstrip currency as the primary manner of spending. It probably already has. Let it continue and currency will become obsolete. I love places that don’t accept credit. Credit is just a money industry ploy, especially when considering the profits from interest and the fat in executive salaries. We’re running away from reality, into the arms of the greedy rich.

    • Sam Gardner72

      Biblicaly it is how we are turning into a cashless society and one world government. I too am thinking of doing the same with my money. Soon though I fear we will not be able to buy anything with cash. Forcing us to use plastic. The Durbin Amendment is just a small step into this process.

  • Buster

    Durbin = As*whole!

  • Fred Sax

    i just found out that my US debit card with Merrill Lynch will no longer be accepted in certain countries after January 31st 2012. I travel to France quite frequently and use my debit card there all the time. I don’t know how they think I can travel and not be able to access my money. They said this has something to do with the Durbin Amendment. Does this mean that the US is no longer doing business with these coutries or just Merrill Lynch, which is owned now by Bank of America?? This just doesn’t seem right to me

  • Drewbon

    After reading this post I read in this blog http://www.yuvaltalblog.com/2011/10/durbin-amendment-actually-resulted-in.html about the Durbin Amendment and this guy says that it actually resulted in some interchange increases

  • http://www.ecomm-unity.com commerce exchange

    This is what happens when people that have no idea on commerce draft laws, Durbin is more extensive than that also connected to the mandate that banks need to increase their working liquidity and mandatory 50% of intra regional traffic for merchant processing (if you are in the Eu and your sales are to Canada and US, say bye bye to your merchant account).
    The world of merchant acquiring is rapidly concentrating in a very small core, not good @ all

  • selo

    I live in the Cayman Islands where I operate a couple of businesses and recently call my bank to find out about the legality of the 3% my additional charges when I pay with the card. The bank gave me their headquarters number in the Bahamas who tossed me the Visa phone number. In speaking to an agent of Visa I was told this fee is illegal and that once reported the merchant will be investigated. I was making a transaction thereafter and was charge a 2% which I question and the merchant refer me to the Durbin Amendment. Since it was a choice between the continuation of my businesses and the applicable percentage I paid it. Do any one realize the consumers are paying twice as in my case who have to pay 18% interest to the bank and then 2% to the merchant; this is killing the consumers.

    • Guest

      The consumer deserves it if they can’t spend money they actually have. Why is it the retailers fault that everyone ones to spend themselves in to debt oblivion. People have got to get smarter about what equity means.

  • http://twitter.com/gr8tstuff4u Lynda Colter-Bergh

    As a Merchant Services Processor, I am amazed how many businesses are not aware that Durbin decreased a lot of their interchange rates. The reason? Their processors didn’t pass on the savings because they were in Tiered pricing. Yes, a few who were quoted really low Tier rates will see a rise. But those who were higher should see a drop. Best plan in most cases is to go with Interchange plus so the savings are passed on to you.

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  • Saed

    Wells Fargo start charging a service charge since October. The money we saved as a small restaurant was reversed by “Service Charges”: DEBIT SALES DISCOUNT RATE 0.014 DISC RATE TIMES $24,066.42 = $336.93
    I just dumped Wells Fargo as a merchant & soon to dump them as a bank.

  • enough

    First of all I will never use a debit card, if you do not understand why you are lost. Just got a letter from bank saying I will not be able to use to buy or get cash back. After 25 years i am pissed. Take durbin and the Fed and hang them high. I guess I need to find a new bank I walk by evrey day.

  • enough

    On previous post was talking about my ATM, you can see I am pissed

  • Mrgrossber

    one major thing that we are forgetting here, is that the day the retailer starts charging the consumer extra for using their credit card is the day that consumer never comes back to their store. Additionally, you pay fees on the total sale which includes the tax we are collecting for the government. So in essence, we are paying an additional tax for accepting these credit cards.

    Mike Gee

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  • kay bergemann

    Thank your taking care of the small peoples. However, the surcharges to merchants, when customers use reward cards have been absent from this discussion. The surcharges can be more than double addition to the discount rate. When financial companies offer perks and rewards with Visa/Master cards, we merchants are NOT GAINING ANYTHING but we have to pay for it. example $500 charge transaction would have cost $6.45 discount bring net 493.55 but the charge card with perks cost $16.+ discount resulting net $483.45 to us. I am thinking that this is not fair at all. I would like to see some kind of justice. Please help us (merchants hit hard right and left…) thank you for your time. Kay Bergemann

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  • Strei

    I have just been informed by my credit card processor that Visa will be implementing a monthly Fixed Acquirer Network Fee which is tiered and is based on your business type referred to as your Merchant Category Code, the number of locations you have per taxpayer ID and whether a customer is present or not present when purchasing goods or services. Goes into effect April 1, 2012. Of course I received my notice around the 20th of April. This is a great example of how a merchant is at a loss to know what charges are being accrued at their point of sale on a daily basis. At the end of the month it is still difficult to track as their statements do not itemize each transaction’s costs. They like to lump it. I call all credit card processors liars and thieves. Been doing this for 13 years and have changed 4 or 5 times on the promises and it always results in actions like the one above after they hook you. Now I am getting calls, several a day, spouting of the advantages they can offer due to the Durbin Amendment. HA! I have told people that if you think the Federal Government is powerful, you have not dealt with Visa and Mastercard who dish out whatever they like knowing we have to take it. Good luck trying to regulate these monsters of our financial world.
    Sandy Trei

  • Adamflieshigh

    About the FDA approved products. I use these products ever day. But to be honest I would love to see what they put in thr supplements. The companies walked all over us again. In other words if Thiers example: steroids in the supplements we can never know, or even a poisonous supplement. This way they exchange good protien to the worst on the market and guess what? Us the consumer are coughing up money, and supporting this act. Why not get the FDA to check on supplements, if anything it’ll help us! That’s the politics of it! I mean common why wouldn’t you want someone to make sure what your putting in your body is safe!

  • thomas

    who really benefits from this act???

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