Swipe this! Yesterday, the Senate actually stood up for consumers. Public Citizen’s financial policy analyst / sometimes poetic, often *sarcastic, wordsmith Bartlett Naylor for once had good things to say!
His statement regarding this consumer victory:
“Public Citizen applauds the Senate for standing firm against bankers’ attempt to preserve their lucrative and unjustified debit card swipe fees, which have functioned as little more than a wealth transfer from the poor to the rich.
Four banks alone account for $8 billion of the $16 billion in annual swipe fee profits. That oligopoly shows the need for the cap authored by Sen. Richard Durbin (D-Ill.) and approved last year as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Will retailers pass on the savings, an average of 32 cents per transaction? Retail markets are competitive and transparent enough that American consumers ought to recoup the savings in reduced prices.
Will regulating swipe fees harm the small banks that should be the backbone of credit in America? Certainly not. Only banks with more than $10 billion in assets are subject to the cap.
If debit swipe fees are capped, the bankers argue, they’ll be forced to make up the difference by increasing other fees. But bank profits aren’t a universal constant. When banks are stopped from profiting unfairly and can’t make up the difference by providing more value to customers, then they should simply profit less.”
*Bartlett Naylor just informed me he prefers “sardonic” to “sarcastic.” Duly noted Bart!