Sen. Bob Corker (R-Tenn.) continues to criticize the Dodd-Frank Act as consumers are being forced to pay more for financial services.
“Beginning this month, customers at many banks are being told that using debit cards will cost them a monthly fee,” Corker wrote in a recent column on Politico.com. “Why? The answer lies in a provision of Dodd-Frank, known as the Durbin amendment, which sets a limit on the price that banks can charge retailers for their customers’ use of debit cards.”
Corker co-sponsored an amendment earlier this year that would have delayed the implementation of the Durbin Amendment in order to provide more analysis on its impact. The amendment was defeated in the Senate and the Durbin Amendment went into effect on Oct. 1.
“Retailers argued they were being charged too much by big banks for debit-card transactions, and that if Congress would put in place a price cap on these interchange fees, they would pass savings along to customers,” Corker wrote on Politico.com. “Unfortunately, as many of us predicted, the reality looks somewhat different.”
Banks are now raising existing fees as well as adding new fees in order to make up for the revenue they are losing on debit card fees. Corker said that there was no evidence that retailers would pass on their new savings to customers.
Corker wrote that Congress should not be picking winners and losers in the industry.