Ellison Joins Bipartisan Coalition to Crack Down on Credit Card Swipe Fees

Press Release

At a Capitol Hill press conference Tuesday morning, Congressman Keith Ellison (D-MN) joined a bipartisan coalition of lawmakers to call for legislation cracking down on credit card swipe fees.

The Durbin amendment (introduced by Illinois Senator Dick Durbin), directs the Federal Reserve to ensure that the fees small businesses pay to process debit card transactions are reasonable and proportional to the costs incurred. It also prevents card networks, like Visa and MasterCard, from penalizing small businesses that offer discounts to customers paying in cash.

Credit and debit card interchange fees cost American consumers $36 billion a year -- or $300 for the average family. Many businesses report that they spend more each year on interchange fees to credit card companies than on providing health insurance to their employees.

"Interchange fees are about 2% of each transaction. When you start adding up how average Americans are paying fees right and left, it becomes clear that small business owners and consumers are being needlessly nickeled and dimed to death," Rep. Ellison said. "At a time where millions are looking for work, wages are stagnant, and the economy is still fragile, we must take action to stop big banks from ripping off consumers and small businesses with these excessive fees."

"Small businesses around the country are struggling to stay in business as they bear the brunt of the credit card industry's out-of-control swipe fees. These cash register rip-offs prevent small businesses from growing and creating jobs, and consumers end up paying the price," Rep. Welch said. "This practical, bipartisan proposal will bolster small businesses by cracking down on the worst abuses perpetuated by the credit card industry."

The debit card restrictions in the Durbin amendment apply only to big banks with more than $10 billion in assets, and it exempts 99 percent of credit unions and smaller banks.

The Durbin amendment is based on two House bills sponsored by Welch and co-sponsored by Rep. Ellison: the Credit Card Interchange Fees Act (H.R. 2382) and the Electronic Check Parity Act (H.R. 5199).

Congressman Ellison joined Reps. Peter Welch (D-Vt.), Bill Shuster (R-Pa.), Chris Carney (D-Pa.), Walter Jones (R-N.C.), and John Hall (D-N.Y.) to sign a letter to Speaker Pelosi and Minority Leader Boehner emphasizing their support for the Durbin swipe fee amendment.

Source