Posted on Thursday, 30th June 2011 by Jesse Walker
WASHINGTON – The Federal Reserve on Wednesday adopted debit-card swipe-fee rules that are more beneficial to banks than had been expected. The Fed rule cuts fees retailers pay to accept debit-card payments to 21 cents, plus a conditional charge of a penny and 0.05% of the transaction value for fraud prevention. On the average debit transaction of $38, the Fed’s rule would have retailers pay 23.9 cents, from the roughly 44 cents they currently pay. The initial proposal the Fed released in December would have cut fees that retailers pay to accept debit-card payments to a range of 7 to 12 cents a swipe. The new rules will still shift billions of dollars in revenue from financial institutions to merchants. Fed governor Elizabeth Duke voted against the decision, arguing that it will increase the regulatory burden on small issuers.
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