Lower credit card swiping fees may get delayed two more years

4/29/2011

For many small business owners, one of the biggest operational expenses are credit and debit card fees. The issue has come to the forefront over the past week as a group of senators are actively trying to legislate a further delay of the lowering of swipe fees to conduct more research, the New York Times reports.

Last summer's Dodd-Frank financial reform law proposed that swipe fees be reduced to no more than 12 cents per transaction. However, many banks, which make a substantial part of their revenue off these fees, feel that 12 cents is too low. This has led senators to call for a delay on any price changes so a two-year study can be conducted to determine prices fair for both parties.

"More than 11,000 commenters have provided us input on this proposed rule," Ben Bernanke, Federal Reserve chairman, explained. "Many of the comment letters are quite detailed and extensive and address both specific issues related to the complexity of the U.S. debit card market in which this rule will operate."

According to Fight Swipe Fees, Americans paid $48 billion in swipe fees in 2008, up threefold from 2001. The rising swipe fee costs have driven many small business owners to increase their product prices in response.