Trump's Policy Reform Means Big Changes for Small Retailers
President Donald Trump's plan to repeal the Wall Street Reform and Consumer Protection Act of 2010, otherwise known as Dodd-Frank, is just about complete. While language in the Act has imposed a few regulations on bigger businesses that seem unnecessary, there was one key component that was created to help protect small to midsize retailers — making a fix to the way debit card swipe fees are processed. Reports say The Durbin Amendment to the Dodd-Frank Act was put in place to bring transparency to the to debit card swipe fee market and help level the playing field for small to midsize retailers and merchants. The CHOICE Act, currently under consideration by the U.S. House Committee on Financial Services, will remove this amendment, which may, in turn, drastically raise debit card swipe fee costs for small businesses.
Total Retail's Take: Repealing debit card swipe reform will be a change for all parties involved. It will raise costs for every business that accepts debit cards (almost all). By removing the Federal Reserve cap on the debit card fee for retailers, banks and card issuers (such as Visa and MasterCard) will be able to set their own fees. Under the current Act, debit card swipe fees have gone down, on average, from 44 cents to 24 cents. We'll have to wait and see the impact this potential legislative change will have on merchants, particularly SMBs.