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WASHINGTON, D.C. -- All eyes in the convenience and petroleum industry are on the U.S. Senate today, as an expected 2 p.m. vote on an amendment to delay swipe fee reform draws near. This afternoon's vote on the proposal, which is being presented as an amendment to the Economic Development Administration Reauthorization Bill, could be the final chapter in the retail industry's long journey to bring swipe fees under control.
In December, the Federal Reserve proposed a cap on the debit card fees retailers can charge customers, at 12 cents per transaction. The new rule was set for a final vote on April 21, with implementation slated for July 21.
The push to delay swipe fee reform began in earnest in March when Sen. Jon Tester (D-MT) introduced a bill to put any rule on hold for two years to further study the issue. In May, Tester and his colleague across the aisle, Sen. Bob Corker (R-TN), then adjusted that timeframe to 15 months – six months for the study, six months for the Federal Reserve to rewrite the rules and another three months for implementation, as CSNews Online previously reported.
However, yesterday the two backers of the bill – referred to some in the retail industry as a "kill bill" because any delay could effectively kill any reform – ceded some ground by saying, at the very least, the Fed should have six months to study the issue of swipe fee reform. At that point, the Fed could issue a new swipe fee rule if certain conditions are met. If the independent government organization finds that the current proposal would hurt consumers or fail to protect banks and credit unions with less than $10 billion in assets, then the Fed will have another six months to rewrite the rule.
Tester and Corker need 60 votes in the Senate for their amendment to pass. While some industry insiders doubt they can hit that number, numerous published reports have noted that the pair has picked up some votes in the past few days.
Proponents of reform are still fighting. In a letter to the Senate yesterday, the National Retail Federation said the new version of the delay amendment is a compromise. "Senator Tester is portraying his amendment as a compromise because it would delay swipe fee reform by 12 months rather than the 24 months proposed in legislation he introduced earlier this spring," read the letter signed by David French, senior vice president of government relations at NRF. "But the bill is no compromise. It is a sham intended to kill swipe fee reform even more quickly than his original bill and should be seen for what it is."
NACS -- the Association for Convenience & Petroleum Retailing -- is also urging its members to make a final push, adding that "the Tester amendment is neither a compromise nor a study -- and it is not a six-month delay that its supporters are touting. The amendment is damaging -- it unravels our efforts to implement much-needed debit card swipe fee reforms."