The news: The National Restaurant Association and the Restaurant Law Center (RLC) submitted comments Sunday in response to the Federal Reserve System Board of Governors’ (the Fed) “Debit Card Interchange Fees and Routing” Notice of Proposed Rulemaking (NPRM).
What happened: The Association and RLC expressed support for the Board’s proposal but urge the Board to go further in lowering debit card swipe fees and to eliminate additional fees so that the new rate is fair and equitable for debit card issuers, restaurants of all sizes, and diners. The comments outline why the Board should:
What we’re saying: “...The weight of credit card fees gets heavier each year because there is no regulation on them, but the Fed has the responsibility to ensure that debit interchange fees remain reasonable. This is their chance to provide a small bit of relief from these costs for restaurant operators and consumers,” said Sean Kennedy, the Association’s EVP of Public Affairs. A little background: The Fed is required by the Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act to review debit card interchange fees biennially and evaluate if the fees remain reasonable and proportionate to issuer costs. This NPRM is in response to its most recent evaluation, which began after retailers filed a petition for lower caps in 2022. What’s next: The Fed is unlikely to make a decision this year. In the meantime, legislation to effectively block the Fed’s effort has been introduced in the House, the Bank Resilience and Regulatory Improvement Act, H.R.8337. This bill would increase debit card swipe fees for restaurants and is scheduled to be marked up by the House Financial Services Committee Thurs., May 16.
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