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The Food Marketing Institute (FMI) was not surprisingly against Friday’s announced increase in the interchange fees on payments using Visa rewards cards, calling such an action “deplorable…[a]t a time when consumers and retailers are fighting for their economic survival.”
Leslie G. Sarasin, FMI’s president and chief executive officer, additionally pointed out that the timing was particularly poor, coming just a few days after April 15, and the deadline to pay taxes. “Interchange is, in effect, a hidden tax on every plastic transaction, fixed by the credit card companies and banks in an anti-competitive market,” she explained. “In a truly competitive market, companies offer consumers the best value for their dollar. We see this principle at work every day in the supermarket industry. Consumers deserve the same value when they use their credit card.”
Credit card companies and banks extract an interchange fee averaging about 2 percent on every credit card transaction. The total cost of interchange fees has tripled since the beginning of this decade, from $16.6 billion in 2001 to a $48.8 billion in 2008, according to the Merchants Payments Coalition and data from The Nilson Report.
Arlington, Va.-based FMI conducts programs in public affairs, food safety, research, education and industry relations on behalf of its 1,500 member companies -- food retailers and wholesalers -- in the United States and around the world. The organization’s retail membership is composed of large multi-store chains, regional firms and independent supermarkets.