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Released: June 30, 2011
Banks convince Fed to raise swipe fee cap
Source: Ylan Mui, Washington Post (Free Registration)
The Federal Reserve raised its limit Wednesday on how much merchants must pay to banks each time a debit card is swiped, an eleventh-hour reprieve for the financial industry after a massive lobbying campaign. The so-called swipe fee, or interchange, will increase from a maximum of 12 cents proposed by the Fed last year to a base charge of 21 cents. Banks can also collect .05 percent of the amount of the transaction to recoup losses from fraud. In addition, the Fed will consider allowing them to receive another cent for each transaction if they take steps to prevent fraud. The new rules will take effect Oct. 1.Read Full Article: Banks convince Fed to raise swipe fee cap
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