Credit Card Companies Lobby Congress to Roll Back Reforms
A year after Congress voted to limit the amount that credit cards can charge for transactions, lobbyists for big banks and credit card companies are lobbying congressmen to delay implementation of the changes. The proposed postponement will cost customers and retailers more than $1 billion a month, the Washington-based National Retail Federation (NRF) said Thursday.
According to the NRF, the proposed limits on the "swipe fees" that Visa (V), MasterCard (MA) and American Express (AXP) can charge retailers for every transaction would save customers and merchants almost $30 billion over two years. Last year's proposal would limit swipe fees to 12 cents per transaction, roughly a 70% reduction from current fees.
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"Congress recognized last year that the credit card companies and big banks have been extracting monopoly-like fees from merchants and their customers for far too long," said Mallory Duncan, NRF senior vice president and general counsel, in a statement. "Now that reform is about to go into effect, the card industry is asking for a do-over they don't deserve."
Last October, the U.S. Justice Department filed an antitrust lawsuit against American Express, alleging that the financial institution engaged in anticompetitive practices related to swipe fees. The Justice Department also said it reached a proposed settlement with Visa and MasterCard over similar charges.
The House Financial Services Committee's Subcommittee on Financial Institutions held a hearing on Thursday to discuss the regulations.
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