Guest Post by Piotr Brzezinski: The Dark Side of the Durbin Amendment

The Durbin Amendment, in particular, looks spectacularly misconceived. By capping the amount banks can charge merchants for debit transactions, Durbin undermined the economics of providing bank accounts to poor customers; although debit interchange fees were unseemly — high profits; low marginal costs — they made it profitable to serve customers who wouldn’t otherwise warrant the cost of attracting their deposits.