Durbin Amendment and how it Affects You

Here’s an interesting article regarding the Durbin amendment passed in 2011 that considerably increased the fees Visa, MasterCard, American Express & Discover charged on CREDIT transactions to offset their losses due to the artificial cap placed on DEBIT transactions. Are merchants better off than before? Did this law, whose intentions were to help merchants lower their costs, actually backfire? Some argue that it has and some argue that it hasn’t. Personally, we have discovered that merchants are actually paying more. Because the networks were already at a competitive price with average interchange fees landing at around .48 cents, the cap at .24 cents really cut billions of dollars of revenue from the networks and processors. Therefore, since the law did not regulate CREDIT transactions, the card companies started racking up rates on that side to make up the difference, offering more “rewards” based cards, like Jimmy Fallon’s “want more cash back?” commercials with the baby. We are going to see a lot of changes in the next 10 years in this industry and with new regulations being written daily, its always a wise idea to get a second opinion and a second look at your bill. Call us right away for a quote. See how recent changes in the Durbin Amendment can affect you.