Arlington , VA, 2016-Sep-14 — /EPR Retail News/ — In a letter sent to House Financial Services Committee Chairman Jeb Hensarling and Ranking Member Maxine Waters, the Retail Industry Leaders Association (RILA) outlined retailers’ objections to H.R. 5983, the Financial CHOICE Act, and urged the Committee to vote against the legislation this week.
The CHOICE Act, specifically Section 335, repeals important debit reforms passed more than six years ago that brought fairness and competition to the debit card market. Swipe fee reform, also known as the Durbin Amendment, passed the Senate in 2010. The reforms require that the fees that banks and card networks charge every time a debit card is swiped are “reasonable and proportionate to the cost of processing the transaction.” Prior to the passage of reforms, card networks utilized their overwhelming market power to raise fees at will. Swipe fees are estimated to cost merchants and consumers $50 billion every year.
According to the letter, “repealing these reforms would remove competition and transparency from the marketplace and provide banks the ability to drastically raise fees – ultimately hurting businesses of all sizes.”
“The Durbin Amendment quite simply brought fairness and competition to a market that previously had none. Repealing the amendment would be turning the clock back on commonsense bipartisan reforms,” said Jennifer Safavian, RILA’s executive vice president for government affairs. “We urge the Committee to take into consideration the harmful consequences of this legislation as they take a vote this week.”
In addition to urging committee members to vote against this harmful legislation, RILA’s letter disputes many false claims made by the banking community about the Durbin Amendment. Despite their claims, the reform has not resulted in consumers’ loss of free checking, nor has it disproportionately harmed smaller banks.
Numerous RILA member companies were among the more than 400 companies that wrote House Financial Services Committee Chairman Jeb Hensarling and Subcommittee Chairman Randy Neugebauer (R-TX) last week urging that they withdraw their respective proposals to repeal debit swipe reform.
RILA is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad.
Contact:
Brian Dodge
Executive Vice President, Communications and Strategic Initiatives
Phone: 703-600-2017
Email: brian.dodge@rila.org
Source: Retail Industry Leaders Association