Swipe Fee Caps Are Here — So Where Are the Savings?

From: Time

By Martha C. White

One of the most contentious parts of the Dodd-Frank financial reform legislation enacted in the wake of the credit crisis was the Durbin Amendment. You may not know it by name, but you know its primary effect: higher bank fees. It’s also the reason behind those infamous debit card fees banks were threatening to implement last year. Trade groups that pushed for the fee cap said the trade-off would be worth it, because customers would see lower prices in stores. So how’s that working out?

Not so great.


Debit Interchange Fees Fall 45% for Biggest Banks After Durbin

From: Bloomberg

Debit-card interchange fees for the largest banks fell 45 percent in last year’s fourth quarter from 2009 as U.S. caps took effect, according to data compiled by theFederal Reserve.

Average interchange fees for so-called non-exempt issuers, or banks with more than $10 billion in assets, dropped to 24 cents on average during the quarter from 43 cents two years earlier, according to Fed data released today. The shift occurred as limits championed by U.S. Senator Richard Durbin, an Illinois Democrat, took effect.

Average fees received by banks and credit unions with less than $10 billion in assets remained at 43 cents during the fourth quarter, the data show.