Austen Jensen, senior vice president for government affairs of the Retail Industry Leaders Association, issued the following statement ahead of the hearings on Capitol Hill this week where Jerome Powell, Chairman of the Board Governors of the Federal Reserve will be testifying on the State of Monetary Policy:
“As Chairman Powell addresses Members of Congress this week on the state of the economy, one of the issues the Chairman and the overall Federal Reserve Board should be pressed on is their complete failure to update the bipartisan debit reforms that were passed under Dodd-Frank over a decade ago. During this time, the Federal Reserve has chosen to prioritize policy revisions that benefit Wall Street banks over Main Street businesses and leading retailers. This can simply no longer stand.
“Since 2009, the largest financial institutions have seen their costs reduce by 52% from seven cents to three to handle debit transactions but because the Federal Reserve has been reluctant to address this drastic disparity, Wall Street banks are still allowed to charge merchants 21 cents per transaction—receiving a roughly 600% profit.
“We hope lawmakers from both sides of the aisle will bring this issue to the forefront with Chairman Powell, and encourage immediate action by the Federal Reserve granted to them by Congress to set a true rate that reflects the actual costs to handle debit transactions for all retailers.”
RILA is the US trade association for leading retailers. We convene decision-makers, advocate for the industry, and promote operational excellence and innovation. Our aim is to elevate a dynamic industry by transforming the environment in which retailers operate.
RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs, and more than 100,000 stores, manufacturing facilities, and distribution centers domestically and abroad.