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Eric O’Neill: Security Must Evolve to Keep Consumers Safe From Credit Card Fraud
Cash is no longer king in today’s commercial world. Credit and debit card payments have exploded in the last decade as the preferred method of payment for transactions worldwide. And with this drastic shift, banks and retailers must ensure consumer data is protected at all stages of transactions. Continue Reading
CEI: No More Free Checking for the Poor
The Durbin Amendment strikes again. Today brings further evidence that the little-known amendment to the Dodd-Frank Act of 2010 by Sen. Richard Durbin (D-IL), which imposed price controls on debit card fees, has stripped access to financial services for the less affluent. Continue Reading
Digital Transactions: Merchants Celebrate the Durbin Amendment’s Sixth Birthday as Payments Group Sneers
The Durbin Amendment’s debit card interchange price cap took effect six years ago this month, prompting a merchant group to celebrate the occasion and claim the measure has saved consumers and merchants $48 billion. But a lobbying group of payment networks and banks derided those savings estimates and once again said the amendment has hurt consumers. Continue Reading
NBCC: Study by Federal Reserve economists shows the ‘Durbin Amendment” is a failed policy
It sometimes amazes me how many proof points Congress needs to act on an issue. Here is hoping that on the matter of debit card interchange fees, a recent Federal Reserve report is the straw that breaks the camel’s back. The new study recently published by two Federal Reserve economists provides definitive proof, once again, that the Durbin amendment is a failed public policy. This deep dive examines the impact these price controls have had on consumers, and comes to the same conclusion that we and many others have been telling Congress for years: it hurts the very people Congress says they are trying to protect. Continue Reading
NBCC: The Durbin Amendment Will Yet Be Judged for Its Failures
In a disappointing turn of events, Congress has decided to strip out crucial language from the Financial CHOICE Act that would have righted a serious wrong done to consumers over the last seven years. Last month, the House Financial Services Committee voted to include language in the bill to repeal the disastrous Durbin amendment, and do away with price controls on debit interchange fees that have provided retailers $42 billion in profit since 2011. These same retailers promised to lower prices for their customers with the additional revenue, but those savings never materialized and in many cases prices have been increased. Tacked on to the enormous Dodd-Frank bill in the 11th hour, the Durbin amendment was full of empty promises that were never fulfilled. Continue Reading
NAFCU’s B. Dan Berger: Tell Congress it’s time for data-security standards for retailers
Every time there is a retailer data-security breach, credit unions step forward to make their members whole. A NAFCU survey found that its member credit unions paid an average of $226,000 each in costs associated with retailer data breaches in 2014. Meanwhile, large companies like Target might lose less than one-tenth of one percent of their annual sales due to a data-security breach; and if they want to recoup expenses, they can always raise prices. Credit unions, as not-for-profit, member-owned institutions, have no such remedy. It’s time to get a national data-security standard in place for retailers. And to do that, we need everyone in the industry – trades, credit unions and the more than 107 million credit union members nationwide – to raise their voices and make Congress take action. Continue Reading
CEI’s Iain Murray: House GOP Forgets History of Price Controls
In what American Commitment President Phil Kerpen called “a gutless sacrifice of principle,” last week the House GOP capitulated to relentless lobbying from big retail interests by stripping language repealing price controls on debit card use from the Financial CHOICE Act. This is not only wrong because the effect of the price controls has been to increase costs for those on the margins of the banking system – the underbanked – but because price controls are always harmful. They distort the normal working of supply and demand and generally benefit most those whom they were not intended to help in the first place. Thus, for example, the debit card price controls were purported to help small merchants, but in many cases they saw their costs go up, as they lost access to deep discounts they had before the price controls were introduced (the price ceiling actually became a floor.) Continue … Continue reading
Heritage’s Norbert Michel: Congress Should Repeal the Durbin Amendment Because It Is a Price Control
Business owners expect conservative members of Congress to protect them from the federal government. They particularly rely on conservatives for protection against government price controls. No self-respecting business owner wants the federal government telling him what price he can charge. Business owners – not federal bureaucrats – best understand what prices they need to charge to earn a living and to make their investments worthwhile. Continue Reading
CEI Criticizes House for Capitulation on Durbin Amendment Price Controls
CEI financial policy expert Iain Murray criticized the House for stripping out repeal of the Durbin amendment yesterday from the Financial CHOICE Act. The House Republicans’ capitulation on Durbin repeal is a slap in the face for lower-income Americans. All the evidence suggests the cap on debit card interchange fees resulted in a windfall for retailers who failed to pass on savings to consumers. In fact, many of those consumers were hit by higher bank fees as banks sought to replace the lost income stream from processing debit card transactions. The result has been a net loss of around $25 billion a year for American consumers, most of it born by low-income households. The House had a chance to right this wrong, and they blew it. Continue Reading
NTU Disappointed Durbin Amendment Repeal Pulled From CHOICE
NTU’s Executive Vice President, Brandon Arnold, responded to the repeal of the Durbin amendment: National Taxpayers Union is extremely disappointed by the decision to remove language from the Financial CHOICE Act that would have repealed price controls on debit card swipe fees. While its supporters claim that the Durbin Amendment is a pro-consumer measure, it has instead been little more than a government-imposed windfall for the retail industry. Continue Reading