Retailers Comment on House Financial Services Vote on CHOICE

The Retail Industry Leaders Association (RILA) issued the following statement in response to a vote in the U.S. House Committee on Financial Services on legislation that repeals reforms passed more than six years ago that brought fairness and competition to the debit card market.  

Swipe fee reform, also known as the Durbin Amendment, passed the Senate in 2010 with 64 votes. The reforms require that the fees that banks and card networks charge every time a debit card is swiped are "reasonable and proportionate to the cost of processing the transaction.” Prior to the passage of reforms, card networks utilized their overwhelming market power to raise fees at will. Swipe fees are estimated to cost merchants and consumers $50 billion every year. 

“Today, by advancing the repeal of critical debit card fee reforms, the House Financial Services Committee put the interests of Wall Street ahead of those of Main Street. Members who voted for the CHOICE Act have voted to give the largest banks and card networks license to return to their past practice of fleecing merchants and consumers of billions of dollars every year. RILA will continue to fight this ill-conceived legislation and educate industry stakeholders on where lawmakers stand on this important issue,” said Jennifer Safavian, RILA's executive vice president for government affairs.  

Numerous RILA member companies were among the more than 400 companies that wrote House Financial Services Committee Chairman Jeb Hensarling and Subcommittee Chairman Randy Neugebauer (R-TX) this week urging that they withdraw their respective proposals to repeal debit swipe reform.  

Swipe Reform Facts: 

Banks Collected Most Debit Swipe Fees Ever in 2015 

“A new study shows that the Durbin Amendment has yet to put a big dent into FIs’ total debit interchange revenue, with banks and credit unions amassing $18 billion in [debit] interchange in 2015—the highest total ever.” (Source

Small Banks are Among Swipe Fee Reforms Biggest Winners  

“There is substantial evidence that the ceiling did lower interchange fees collected by banks with assets above $10 billion, from around 44 cents to about 22 cents per transaction. But there was no such decline for small banks. Furthermore, after the ceiling was imposed, the volume of transactions conducted with cards issued by exempt banks grew faster than it did for large banks. Finally, Zhu Wang shows that interchange revenue fell substantially at large banks after the fee ceiling was imposed but continued rising for small banks.” (Source

Swipe fee Reform Saves Consumers Billions and Creates Jobs 

When debit swipe reform went into effect in October 2011, the average debit swipe fee on cards from covered banks dropped from 48 cents to 24 cents per transaction, saving consumers $5.8 billion in lower costs for good and services and saving merchant businesses $2.6 billion in 2012. The savings in turn supported 37,501 new jobs. (Source

Free Checking Grows  

According to the American Bankers Association (ABA), more Americans have free checking today than they did before the Durbin Amendment passed. In 2010, the ABA reported that 53% of consumers had free checking compared to 61% last year. (Source 1Source 2


RILA is the trade association of the world's largest and most innovative retail companies. 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. 

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