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WASHINGTON, D.C. — Legislative action taking aim at financial reform — including the hard-won debit card swipe fee reform — continues to gain speed on Capitol Hill.
In the latest move, U.S. Rep. Jeb Hensarling (R-Texas) released a discussion draft of the Financial CHOICE Act, the Republican plan to replace the Dodd-Frank Act and promote economic growth.
CHOICE stands for Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs.
"We want the American people to see our proposal because it will result in economic growth for all and bank bailouts for none," said Hensarling, chairman of the House Financial Services Committee. "Dodd-Frank has failed. It has contributed to the slowest, smallest, weakest and worst economic recovery of our lifetimes. We must instead offer all Americans greater opportunities to raise their standards of living and achieve financial independence by replacing Dodd-Frank with real reforms that work."
The committee also publicly released an extensive description of each section of the proposal and how its reforms will work. Both can be found at the committee's website.
However, retailers are not staying quiet. The Retail Industry Leaders Association (RILA) and the National Retail Federation (NRF) spoke out against the proposed legislation.
According to the Retail Industry Leaders Association (RILA), the legislation contains a specific provision to repeal reforms to the fees that merchants pay when a debit card is used to make a purchase.
"It is disappointing to see the CHOICE Act favors the largest banks and card networks in the nation over Main Street by repealing the vital free market policies contained in the Durbin Amendment," said Austen Jensen, RILA's vice president of government affairs. "
He added Hensarling should not move forward with this legislation until consumers have had an opportunity to communicate with their elected officials on the costs to consumers and businesses associated with this proposal.
"As the chairman has pointed out in the past, financial reform is far too important to move quickly without thoughtful dialogue and this bill should not be acted on until after the extensive summer district work period," Jensen said. "Giving banks and card networks a green light to raise fees on businesses and consumers again is not the kind of reform the American people want," Jensen added.
NRF added Congress should reject the proposal.
"Repealing this cap would double the fees banks charge retailers and their customers when they use a debit card to pay for purchases," NRF Senior Vice President and General Counsel Mallory Duncan said. "Doubling swipe fees and driving up prices paid by consumers seems like a strange platform to ask members of Congress to run on during an election year. A vote to repeal the Durbin Amendment is a vote for higher consumer prices and isn't likely to win many votes in November."