Retailers, grocers, restaurants, and other businesses cheered a recent dodge of a possible injurious change for them. On Thursday, Republicans didn’t support hard enough a cap elimination of debit card fees. This decision would have allowed banks to charge retailers more whenever customers paid their products with a debit card.
Hensarling Considered the Debit Card Fees too Controversial
Republican Jeb Hensarling from Texas is the chairman of the Financial Services Committee. He was the main character who put in a lot of efforts to strangle the Dodd-Frank law. This is a strict series of rules instated to mitigate the 2008 financial crisis. Despite the end of those challenging times, they continue to regulate the financial industry. Banking institutions have been complaining that these stipulations are hurting their business while letting retailers move too freely on their territory.
However, not all Republicans were on board with allowing banks to proceed as they please with their debit card fees. As such, the house experienced a stark division of opinions. Eventually, Hensarling decided to cut this topic for good because of a lack of supporters. The Republican gave an additional explanation for his actions.
This change of the cap on debit card fees is actually just one amendment in a broad financial reform bill. Since this one point in a comprehensive bill stirred such controversies, Jeb Hensarling decided to put an end to it altogether. This way, the rest of the bill remains with a more balanced content.
“We won’t let this one provision hinder passage of an important priority bill.”
Banks Will Continue to Charge Retailers only Half of Their Actual Fees
Trade lobbyists were happy to hear the news. Austen Jensen from the Retail Industry Leaders Association is one of the authorities that cheered the decision. He claimed that this was enough of a sign for banks to back off. On the other hand, the president of the American Bankers Association, Rob Nichols, declared that the banking world would continue to fight for a change.
The Dodd-Frank law impairs banks from charging the fees they consider right for operations done through their debit cards. As such, instead of receiving an average of 45 cents per transaction, they only get 24 cents.
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