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Industry leaders are hailing the U.S. Senate's passage yesterday of the Dodd-Frank Wall Street Reform and Consumer Protection Act as an important victory in the campaign to bring about meaningful credit card swipe fee reforms.
"This is a long-fought victory for supermarkets and their customers across the country," said Leslie G. Sarasin, president and CEO of Arlington, Va.-based Food Marketing Institution (FMI). "Our members'
extensive work on this spans more than the past decade. These fees represent the only completely uncontrollable cost for retailers.
Supermarkets and their customers will see the benefits of a system of reasonable and proportional costs in a competitive and transparent marketplace."
Peter Larkin, who recently took the helm of the National Grocers Association (NGA) as its new president and CEO, also cheered the passage of the reform and consumer protection act. "Retail grocers and other merchants won a major victory with the inclusion of Sen. Durbin's amendment to reform excessive debit card interchange fees and restrictive practices that are imposed by the credit card networks and their largest banks."
Larkin said he is "especially proud of the grassroots efforts by independent retail grocers and their wholesalers in educating members of Congress about these credit and debit card abuses. Passage of this law makes an important first step forward by giving the Federal Reserve Board regulatory authority to reduce debit interchange fees and reform anticompetitive rules."
Added Sandy Kennedy, president of the Arlington-based Retail Industry Leaders Association (RILA): "The reforms contained within financial regulatory reform legislation focus narrowly on large Wall Street financial institutions at [the] heart of the problem. Swipe fee reforms will benefit retailers and their customers, while excluding community banks and credit unions from the new rules."
"This bill represents the sort of Main Street stimulus that this country has been waiting for - and brings real, tangible benefits for merchants and their customers," said the Merchants Payment Coalition (MPC), a Washington-based industry group uniting retailers, supermarkets, drug stores, convenience stores, fuel stations, online merchants and other businesses - representing over 100 associations (including FMI and RILA), 2.7 million stores, and 50 million employees - against excessive swipe fees. "[The] vote means that businesses will have lower costs, more fairness and transparency, and the chance to provide our customers with better service and better deals on the things they buy every day.
The swipe fee reform language within the Dodd-Frank legislation - which passed by a margin of 60 to 39 and which is named for Sens. Christopher Dodd (D-Conn.) and Barney Frank (D-Mass.) -- was based on an amendment introduced by Sen. Richard Durbin (D-Ill.) that passed the Senate in May.
An earlier Senate vote cleared the bill for floor action by a 60-38 margin. The House of Representatives has already passed the legislation, and President Obama is expected to sign the bill into law next week.
The legislation was passed in response to the financial collapse and regulatory failures that occurred in 2008.