Retail News Breaks Archives
NACDS enlists RxImpact in swipe fee reform battle
June 8th, 2011
ALEXANDRIA, Va. – The National Association of Chain Drug Stores made a grassroots push to rally retail and pharmacy advocates to oppose a Senate proposal to delay debit-card swipe fee reform.
NACDS said Wednesday that it enlisted its RxIMPACT program to engage industry advocates and build support against Senate bill S. 575, introduced by Sen. Jon Tester (D., Mont.) that would delay by a year swipe fee reform passed by Congress last year.
"The legislation, S. 575, is being pushed by the big banks and credit card companies who are pressuring lawmakers to support the Tester bill and delay these important reforms," NACDS states on the RxImpact website. "NACDS RxImpact strongly opposes efforts to delay these important pro-consumer regulations. Please help us fight these efforts by writing your senators today."
The Federal Reserve is set to implement the swipe fee reform in July.
"NACDS strongly opposes any attempt to delay or hinder the pro-retailer and pro-consumer swipe fee reform," Steve Anderson, president and chief executive officer of NACDS, said in a statement. "Swipe fee reform is a top priority for the retail community, and I urge every NACDS member and every consumer who uses debit or credit cards to contact their United States senators in opposition to S. 575.
"It is critically important that retailers and consumers act now to ensure that Sen. Durbin's swipe fee reform is fully and properly implemented," Anderson noted.
The proposed delay failed in the Senate on Wednesday in a 54-45 vote, which left the measure six votes short of the 60 needed for approval.
Swipe fees, levied on retailers on each transaction where a debit card or credit card is used, have more than tripled over the last decade, costing retailers about $50 billion a year in added costs and driving up prices for consumers by about $500 a year per household, NACDS reported.
President Barack Obama has signed into law a provision, authored by Sen. Dick Durbin (D., Ill.), requiring the Federal Reserve to implement swipe fee reform that is "reasonable and proportional" to the costs incurred by banks and credit card associations to process these transactions. The provision is part of last year's financial regulatory overhaul.
The law aims to lower debit-card swipe fees by an estimated 70%, saving retailers about $1 billion a month. The savings could be conveyed to consumers as reduced prices, rebates and other incentives.
In March, NACDS and the National Community Pharmacists Association called on Congress to speed up implementation of limits on debit card interchange fees charged to retailers, including pharmacies. NACDS and NCPA sent a joint letter to leaders in the House of Representatives and the Senate asking them to expedite the execution of the Durbin amendment.
Editor's Note: Article updated after Senate vote.