At least 76 percent of retailers surveyed by the Electronic Payments Coalition have not passed on interchange savings to consumers, despite receiving $825 million in profits since the enactment of the Durbin Amendment.
The Coalition’s data, collected from extensive field research, showed that 16 of 21 retailers it visited nationwide either raised prices or kept them the same before and after October 1, which was the enactment date of Sen. Dick Durbin’s (D-Ill.) legislation that cut the price that retailers pay to accept debit cards in half.
The cut was not enough, according to researchers. The National Retail Federation, the National Association of Convenience Stores and other merchant organizations have recently filed a lawsuit against the Federal Reserve claiming that they were promised that they would pay less.
One of the largest merchant payment processing companies, Heartland Payment Systems, said that its merchants have saved $825 million since October 1. That amount is only a small portion of the $8 billion merchants expect to save.
"Merchants' empty promises to pass savings on debit card purchases are coming to light," Trish Wexler, a spokeswoman for the Electronic Payments Coalition, said. "More than two months after the Federal Reserve's rule implementation, customers are actually paying more for the same products – even though retailers are already taking home millions in additional profits. Something is very wrong with this picture."