For independent grocers and the wholesalers that serve them

How Will The Debit-Swipe Fee Ruling Impact Your Business?

Independent grocers were once again screwed by the Fed, which was pushed by the big banks to set debit swipe fees to almost double what it proposed in December, and will in turn prolong the struggle for small businesses to bring parity to the debit card market and ultimately prevent the intended relief from reaching merchants and consumers.

Leaders from the National Grocers Association (N.G.A.) were outraged by the ruling, as evidenced in their remarks that described how “the nation’s largest banks succeeded in pressuring the Federal Reserve in its final swipe fee rule to increase the allowable debit swipe fees to over 21 cents, up from the proposed fees of 7 to 12 cents.” The increase in the allowable debit swipe fees charged by the largest banks with assets over $10 billion does not follow the law and provides little benefit for Main Street independent grocers and consumers, said Peter J. Larkin, N.G.A.’s president/CEO, who noted that the rule does little to level the playing field and will actually perpetuate the anticompetitive actions of the big banks.

How will this ruling affect your business?

Tags: Bank, Federal, Reserve, debit, fee, swipe

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Permalink Reply by Neil Kudrinko on July 3, 2011 at 12:51pm

Canadian grocers have been fighting the same battle for several years now. While our government has been pro-active in establishing a voluntary code of conduct (which would become legislated if not followed), and in refusing Visa and MasterCard the right to establish debit card products, processors and credit card companies have continued to pass along egregious fee increases to retailers. Recently I received a notice of fee increase that would see my non-transaction related costs increase by 89%, and my debit swipe fees rise by 88%. Can you imagine if I told my customer that a loaf of bread would now be over $5.00? Fee increases such as these are a drag on the economy and limit the ability of small business to create jobs. That's precious little thanks from our governments given the role that small business has played in supporting communities through these hard economic times.