U.S. court upholds 21-cent cap on debit card fees
March 21, 2014
|Banks are being named the winners in what has been an ongoing struggle with retailers over debit card swipe fees.|
The U.S. Court of Appeals upheld Friday a Federal Reserve rule allowing banks to charge retailers up to 21 cents per debit card transaction. The decision by the appeals court overruled a lower court’s ruling against the fee cap because it was too high.
Retailers and retail organizations across the country have also argued that the 21-cent cap was too high.
“Many retailers have cited swipe fees as their second or third highest cost behind salaries and employee health benefits,” the National Retail Federation said on its website. “With retail industry profits averaging only about 2 percent, there is no room for retailers to absorb the expense, so swipe fees are passed on to customers in the form of higher prices.”