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Consumer May Pay for Credit Card 'Swipe Fee' Cap
Published on Jun 9, 2011
Read 'Consumer May Pay for Credit Card 'Swipe Fee' Cap' at 'Time to Start Up,' the small business blog by BizFilings.
Retail business owners looking to form an LLC or otherwise expand their operations may have greater financial freedom to do so in coming months.
This week, the Senate rejected a move by banking associations to postpone a law that will place a cap on the amount credit and debit card issuers can charge retailers per sales transaction. Starting next month, issuers can charge no more than 12 cents per purchase, the Boston Globe reports.
However, consumer groups worry that the measure will only encourage banks and card issuers to balance the estimated $16 billion in lost annual revenue by placing new charges directly on consumers.
"So what happens when, say, Visa decides to jack up debit-card rates - as it has repeatedly in recent years? The banks hardly mind, because they get more money, which encourages them to issue more cards, which is good for Visa," writes Jerry Rogers, president of Capitol Allies, for The Hill.
"The average debit-card user won't notice the difference," Rogers ads. "In fact, he might think he benefits if his bank offers a rewards program to encourage him to swipe more."