By Calvin Swanson
The U.S senate passed an amendment requiring banks to lower their debit card swipe fees they charge retailers for every debit card transaction from 44 cents to 12 cents.
Banks and debit card companies substantially oppose the amendment and are strongly urging lobbyists and lawmakers to change the law or repeal it, according to a New York Times report. Banks say the cuts will make it difficult to offer debit cards to customers and that customers may have to pay more charges and fees to make up the costs.
Merchants are urging Washington to go through with this law, which faces an April deadline. Merchants lose $20.5 billion annually in profits due to the 44 cent per-transaction swipe fee.
Consumers most likely will not benefit from the retailers' savings because retailers will likely reap the profits, Stamford Advocate reported. The lowering of swipe fees may be detrimental to consumers because of imposing banking fees that would make up for the reduction of the swiping fee.
The Stamford Advocate reports the swipe fees will not produce consumer benefits or job growth; the report emphasizes the effects the fees will have on consumers.
The N.Y. Times reports that small-business owners claim swiping fees are devastating to their operations, while banks claim they depend on the fees to create more services for customers. The N.Y. Times' report is structured around the businesses and banks' perspective about the fees.