Gas retailers pocketing $1bn Durbin windfall – Electronic Payments Coalition

From: Finextra

US gas retailers are failing to pass on savings from the Durbin interchange fee amendments to customers, effectively pocketing a $1 billion a year subsidy, claims the Electronic Payments Coalition (EPC) pressure group.

The Durbin amendment to Dodd-Frank legislation has seen interchange rates slashed by about 70% for debit card payments for fuel, says the EPC, which is a coalition of banks, credit unions and card networks opposed to the rules.

With high gas prices likely to play a major role in this year’s presidential elections, the EPC has commissioned research from Phoenix Marketing International on the prevalence of debit card use at the pump.


Gas Retailers Gained a $1 Billion Subsidy from Durbin Amendment, With No Evidence of Lowering Gas Prices

New Research Shows Half of All Non-cash Payments for Gas is Debit


WASHINGTON, Apr 16, 2012 (BUSINESS WIRE) — New data released today, by the Electronic Payments Coalition, finds that gas retailers are saving $1 billion annually at the expense of consumers, thanks to the so-called “Durbin amendment,” a provision of the Dodd-Frank legislation which capped what retailers pay to accept debit cards beginning in October 2011. According to the U.S. Energy Information Administration, nearly 134 billion gallons of gas were sold in 2011, with approximately 48 billion gallons purchased using debit — the type of payment impacted by the Durbin amendment, which reduced interchange rates by about 70 percent for this category. However, there continues to be no evidence that retailers are passing along savings from this windfall — even at gas stations, where debit is the overwhelmingly most popular form of payment.


Report: In SEC filings, banks put numbers to Durbin losses

From: ATMMarketplace.com

A report from Charlottesville-based SNL Financial provided some initial insight into the cost of The Durbin amendment to U.S. banks in the 2011 fourth quarter.

As expected, the legislation to limit debit card interchange fees for banks with more than $10 billion in assets had a significant impact on some of the nation’s biggest banks. In 2011 form 10-K reports to the Securities and Exchange Commission, banks provided loss totals.

  • JPMorgan Chase & Co. said annualized net income may be reduced by $600 million because of Durbin limits; the FI said that it may be able to recoup some lost revenue, but likely not all of it.


BB&T revenue from debit-card fees hit by regulations

From: Charlotte Business Journal by Matt Evans, Reporter

The amount of revenue BB&T Corp. took in from debit-card interchange fees dropped dramatically from the third quarter to the fourth quarter of last year as new federal regulations limiting those fees took effect.

David White, a spokesman for BB&T (NYSE:BBT), said check-card fee revenue fell to $42 million in the fourth quarter from $78 million in the third quarter, a decline of 46 percent. The “Durbin amendment” banking-reform law limited the amount banks with more than $10 billion in assets can charge merchants for accepting debit cards to an average of 24 cents per transaction. Before, they had been taking in about 44 cents per transaction.