The Senate recently added an amendment to S. 3217 that would arbitrarily limit the cost that merchants pay to accept debit cards, and eliminate important rules that are in place expressly to protect consumers.

It’s simple: retailers want to shift this cost of doing business to you. And that’s not fair.

Send a letter to your Members of Congress, and tell them to oppose this amendment.

Click on the items below to expand them and read more.

For consumers like you, this amendment would:

By allowing the government to arbitrarily set a price for debit acceptance, community banks and credit unions would be forced to their raise prices for their customers and members or stop issuing debit altogether.

• Force you to pay higher fees and reduce your rewards on debit cards.

  If what merchants pay to accept debit cards is forced down, retailers will profit. To maintain a debit card program, card issuers will have to make up the revenue through such things as:
  
  - Increased fees
  - No more free checking
  - Reduced or eliminated rewards programs
  
  In other words, you will pay more for your debit card so that big retailers can catch a break on what they pay.
  
  » See what happened in Australia when this type of regulation was put into place. Consumers paid more, received fewer rewards, and saw no savings at the register — and merchants pocketed the difference.

• Force you to carry cash at all times.

  Those that don’t have enough cash would have to buy more than they wanted in order to complete the transaction — or would be forced to carry enormous amounts of cash in the event that the merchant imposes a maximum payment.

• Allow discrimination by merchants against certain cardholders.

  Retailers could set unrestricted minimum or maximum amounts to use a debit or credit card — and, not have to alert the consumer to their policy until the very last minute. This means you'll have to carry around cash at all times, or be prepared to buy more than you wanted in order to reach the minimum amount.

• Allow merchants to falsely advertise.

  A merchant could bait customers into the store — one of the key benefits of card acceptance — and only inform the customer of minimum and maximum limits on that card when he or she arrives at the cash register.

For card issuing institutions, this amendment would:

• Force government agencies to stop offering prepaid benefit cards.

  Most states offer benefits on prepaid debit cards — everything from child support to unemployment. If the Fed lowers the rate that these agencies receive to offer those cards, they will simply be unable to continue doing so — and will be forced to forego the significant administrative, cost-saving, and practical benefits that prepaid debit provides.
  
  » Hear from the State Treasurer of Nebraska about how this amendment "unintentionally undermines prepaid card programs, including government programs that provide aid to vulnerable citizens and saves hundreds of millions in taxpayer dollars."

• Harm community banks and credit unions.

  This amendment provides a smoke screen which purports to exempt community institutions from the government price fixing.
  
  In reality, it provides no protection for community institutions.
  
  The effective pricing of debit interchange to as close to zero as possible will result in large banks leaving the system. There is no way that small banks can support the system, and small bank debit volume is effectively limited by their deposits.

• Force debit card issuers to raise fees for their customers.

  Institutions that do continue to offer debit cards will be forced to raise fees for their customers and members.