In what is a huge win for booksellers and other retailers, on May 24, U.S. House of Representative Financial Services Committee Chair Jeb Hensarling (R-TX) announced that backers of the Financial CHOICE Act would drop a provision from the bill that would have repealed a cap on debit card swipe fees. In early May, the American Booksellers Association and other retail groups launched campaigns urging lawmakers to remove the bill’s provision repealing the swipe fee cap (also known as the Durbin amendment).
The Durbin “swipe fee” amendment was signed into law in 2010 as part of the sweeping Dodd-Frank Wall Street Reform and Consumer Protection Act. Under the Durbin amendment, the Federal Reserve set rules that placed a cap on swipe fees for debit cards at 21 cents. In 2012, the Federal Reserve reported that the average interchange fee had nearly been halved.
Republican leaders made the decision to remove the Durbin amendment from the CHOICE Act after confirming that retailer opposition to the repeal threatened support for the rest of the bill, multiple senior Republican sources familiar with the matter told Politico. Retail associations such as ABA, the National Retail Federation, the Retail Industry Leaders Association, and Alliance for Main Street Fairness came out in opposition to the bill, in large part due to the provision repealing the Durbin amendment.
“We urged our member booksellers to tell their lawmakers to end this attempt to repeal the swipe fee cap and, by all accounts, they did just that,” said ABA Director of Public Policy and Advocacy David Grogan. “Booksellers should never underestimate their ability to make a difference. This is a big win for indies and Main Street stores that took on Wall Street lobbyists and won. Repealing the swipe fee cap would have driven up costs for retailers and consumers across the country.”
ABA will continue to monitor the CHOICE Act’s progress to ensure that repeal of the swipe fee cap is not included in the final bill, Grogan added.
Financial Services Committee spokesperson Jeff Emerson said that Rep. Hensarling plans to offer a manager’s amendment to remove the provision from the bill, which he wrote. In a statement, Hensarling acknowledged that repeal of the Durbin amendment was always “the most contentious part of the bill among Republicans.”