I thought the point of the Durbin rule was to protect retailers.

pass savings on to cosumers

I pay my balance off every month, using my credit cards make me money.

/csb

The law of unintended consequences is racist, just like the law of gravity.

"Our study can't be biased. See, we kept the receipts."
Bank associations and retailer associations accusing each other of ripping off consumers. Kinda reminds me of the discourse from Democrats and Republicans.

That anyone would believe any of them makes me a little ill.

I think it's funny that the article starts out by claiming it isn't biased. I'm sure the numbers are fine but the conclusions are opinion and conjecture. Of course prices have gone up! It's called "inflation". The article implies they've gone up because of this law.

Who didn't expect the retailers to pocket the interchange fees? Also "the market" didn't set the prices on the fees (according to the author), the banks got together and made them artificially high. So that's a stupid argument.

The interchange fee part of law helps small businesses especially. It's one of the few laws in this country that do. The extra savings at large retailers hopefully allows them to invest that $825 million somewhere else.

Riiiiight. A study bought, paid for and by the credit card companies? Nope. Not biased or flawed at all.

It's more like banks are going to find a way to charge you more if they want to, regardless of the laws with fee fees and over the fee fees and fee fee fees.

Bunnyhat: cfreak:
The interchange fee part of law helps small businesses especially. It's one of the few laws in this country that do. The extra savings at large retailers hopefully allows them to invest that $825 million somewhere else.


I run a small business.
Because of the new law, I'm gonna save about $20,000 this year.
I have no plans to reduce my prices because of it, but I do plan to give my one employee a nice raise because of it.


This was (I believe) the hoped intention of the law - I seriously didnt expect the price of a 2x4 at Home Depot to drop because of it - and since I, personally, am not going to save any money I'd rather the store (big or small) keep it instead of a giant farking bank that probably incured about a 1/1000th of a cent cost in the actual transaction.

Petey4335: Riiiiight. A study bought, paid for and by the credit card companies? Nope. Not biased or flawed at all.

This. Banks/CC companies don't care about consumers. If this was actually costing consumers money and not the banks they wouldn't care less

cfreak: I think it's funny that the article starts out by claiming it isn't biased. I'm sure the numbers are fine but the conclusions are opinion and conjecture. Of course prices have gone up! It's called "inflation". The article implies they've gone up because of this law.

Who didn't expect the retailers to pocket the interchange fees? Also "the market" didn't set the prices on the fees (according to the author), the banks got together and made them artificially high. So that's a stupid argument.

The interchange fee part of law helps small businesses especially. It's one of the few laws in this country that do. The extra savings at large retailers hopefully allows them to invest that $825 million somewhere else.

Somewhere other than passing those savings on to consumers. You know, like they said they could/would during the lobbying phase of the bill.

From the National Retail Foundation's website:
16DEC2010: "'Any reduction in debit card swipe fees at all, large or small, is a benefit for consumers because retailers are highly competitive and will share that savings with their customers - but the law requires a major reduction,' NRF Senior Vice President and General Counsel Mallory Duncan said."

15JUL2010: "'This is an all-around win for consumers,' Duncan said. 'By requiring debit fees that are reasonable and proportional to actual costs, retailers will see their costs reduced and will be able to pass on the savings through lower prices and greater value for their customers.'"

1JUL2010: "'Retailers want to give their customers full value for every dollar spent and not be forced to raise prices in order to collect unfair fees on behalf of the credit and debit card industry,' Duncan said. 'This legislation will reduce debit card swipe fees and, in turn, help retailers hold down prices for their customers.'"

Plus many others suggesting or insinuating that the Durbin Amendment would hold prices down (including radio ads).

Credit card fees are a contributing factor to rising gasoline prices:

"Credit Card Fees

Factoring in all gasoline sales in 2009 transactions - whether the customer paid by cash, check or by either debit or credit card - credit and debit card fees averaged 4.7 cents per gallon.

In 2009, convenience store industry credit card fees ($7.4 billion) were again more than convenience store industry profits ($4.8 billion).

Between 60 and 70 percent of all transactions at the pump are by plastic - either debit or credit card - but many markets see credit usage at 80 percent or more, with some stores seeing 100 percent payment by plastic."

It is funny to see the comments from the idiots who clearly didn't bother to RTFA.

Oh look how cute!

Banks and retailers are fighting over who gets to bean us over the head and steal our hard earned money.

So let me get this straight. Credit card companies are claiming retailers are not passing the savings onto consumers therefore the money should go back to the credit card companies?

relcec: durbin claimed it was designed to protect consumers, but it was designed to transfer money from you to walmart.

It may not have saved Walmart much of anything. See, gigantonormous companies were able to negotiate much better swipe fees than Joe's Falafel Hut. Especially in the cases where they have some other leverages over the cards (like Costco only takes AmEx... they presumably get near-zero swipe fees, since AmEx gained several million Costco customers who wouldn't normally have had an AmEx).

What capping the fees does do is make the playing field a little more level between Walmart (who was likely paying 5c/swipe before) and the little guy (who was often paying 4%).

Bunnyhat: cfreak:
The interchange fee part of law helps small businesses especially. It's one of the few laws in this country that do. The extra savings at large retailers hopefully allows them to invest that $825 million somewhere else.


I run a small business.
Because of the new law, I'm gonna save about $20,000 this year.
I have no plans to reduce my prices because of it, but I do plan to give my one employee a nice raise because of it.

And that's totally awesome. That extra money your employee gets will directly stimulate the economy. So, thank you!

Yay Obama! Yay government. If only we had MORE of this.

Kraftwerk Orange: Credit card fees are a contributing factor to rising gasoline prices:

"Credit Card Fees

Factoring in all gasoline sales in 2009 transactions - whether the customer paid by cash, check or by either debit or credit card - credit and debit card fees averaged 4.7 cents per gallon.

In 2009, convenience store industry credit card fees ($7.4 billion) were again more than convenience store industry profits ($4.8 billion).

Between 60 and 70 percent of all transactions at the pump are by plastic - either debit or credit card - but many markets see credit usage at 80 percent or more, with some stores seeing 100 percent payment by plastic."

One of my clients owns a couple gas stations. His credit card processing happens through his jobber, the company that hauls the gas from Indy to his stores. The jobber holds the CC money for a month I think and then turns it over to him. He's been complaining because the jobber is holding his CC money for 45 days when the agreement was for 30 days, AND they have a deposit equal to a couple loads of fuel, which was supposed to have been refunded after a certain period that they also haven't returned. The jobber was also treating cash advances as regular purchases instead of in weekly settlements as required by the contract. So apparently even independent, unbranded gas stations were not negotiating with credit card processors. Fees were being negotiated in aggregate by middlemen.

subby obviously misplaced his/her tag.

relcec: "in a February 2011 investor call, Home Depot CFO Carol Tome reported that the adoption of the rule would increase their profits by $35 million this year."

Which on revenues of $68bn, translates to 1/20th of 1%. That's how much the difference in swipe fees was. Basically a rounding error for them, but it's helping small businesses (which were paying much higher fees) a whole lot more than that.

"so how are consumers fairing"?
REALLY?
yeah yeah editorial staff downsize whatever. If you're gonna write for a megamediacorp, you oughtta get crap like that right.

FTA: "12 raised prices by five point one percent or kept prices the same, four stores kept the same prices"

Who the hell did this study, 12 raised prices or kept them the same and 4 kept them the same? Why is there an overlap here? They either raised prices or not. How many only raised prices?

Bunnyhat: Uhuh.

Well, my small business saved money this year, that I will passed along in the form of a raise to my employee. I didn't raise my prices to the costumer, so I'm not sure how I screwed them over to do it.

Did you give millions of dollars to a PAC to contribute to election campaigns and/or create political ads to influence voters? No? Then nobody gives a f*ck about your small business. Sit down, shut up, and be happy we haven't regulated you out of business yet for competing with real companies.

Oh, and sharing your increased profits with your employee!?? WTF man? Are you some kind of communist or something? The right thing to do would have been to cut your employee back to half time, strip him/her of any benefits they may have had, and give yourself a bonus. I'm afraid you just aren't cut out to be a businessman, my friend.

Bunnyhat: mod3072: Bunnyhat: Uhuh.

Well, my small business saved money this year, that I will passed along in the form of a raise to my employee. I didn't raise my prices to the costumer, so I'm not sure how I screwed them over to do it.

Did you give millions of dollars to a PAC to contribute to election campaigns and/or create political ads to influence voters? No? Then nobody gives a f*ck about your small business. Sit down, shut up, and be happy we haven't regulated you out of business yet for competing with real companies.

Oh, and sharing your increased profits with your employee!?? WTF man? Are you some kind of communist or something? The right thing to do would have been to cut your employee back to half time, strip him/her of any benefits they may have had, and give yourself a bonus. I'm afraid you just aren't cut out to be a businessman, my friend.



Good lord, how have I been so blind.

Thank you for opening my eyes.
I cut back my employees pay, canceled her health insurance, and doubled the amount of unpaid OT.
I've also raised rates for customers by 25% and started using lead paint on all my products because I was able to get it 5% cheaper from a supplier in China.

Now you're getting it!!

I know from experience that small retailers eat shiat when it comes to processing credit cards. Small transactions are especially bad. The processing bank charges a connection fee plus a percent of the sale amount. There's a different rate for debit, credit, and rewards cards (cash back, etc.) I don't turn away Amex cards, but I ask real nicely if they have another form of payment.

The connection fee applies to declined sales as well. Screwed up your PIN? That just cost me a quarter. I just assume people that pay with BofA debit cards hate money so much, they don't want me to have any either.

In all, the new rules save me just shy of 100/month. Of course rent, insurance, and trash disposal all went up so I pretty much broke even.

aragonphx: So let me get this straight. Credit card companies are claiming retailers are not passing the savings onto consumers therefore the money should go back to the credit card companies?

Their argument seems to be based around "if we can't make that profit then nobody should." Which, although motivated entirely by greed, is good for the end consumer. If prices end up lower that is. Which I don't have very high hopes for.

cfreak: I think it's funny that the article starts out by claiming it isn't biased. I'm sure the numbers are fine but the conclusions are opinion and conjecture. Of course prices have gone up! It's called "inflation". The article implies they've gone up because of this law.



DING DING DING!

Coca-Cola for one has already told retailers to expect prices to rise 3-6% next year. They have already gone up this year. What this is doing is allowing some of the merchants to not pass through as much of the product price increases to the consumer in an effort to remain competitive.

Lawnchair: relcec: durbin claimed it was designed to protect consumers, but it was designed to transfer money from you to walmart.

It may not have saved Walmart much of anything. See, gigantonormous companies were able to negotiate much better swipe fees than Joe's Falafel Hut. Especially in the cases where they have some other leverages over the cards (like Costco only takes AmEx... they presumably get near-zero swipe fees, since AmEx gained several million Costco customers who wouldn't normally have had an AmEx).

What capping the fees does do is make the playing field a little more level between Walmart (who was likely paying 5c/swipe before) and the little guy (who was often paying 4%).

These guys are priced on what is called "Interchange +" pricing. If Interchange goes down they save money. It's pretty simple.

No fark, shiat-balls!

/that about covers it