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Small-ticket merchants paying higher debit card fees

Su-Lin Hsieh’s family-owned lunch counter, located in Denver, is one of many businesses in the nation suffering from a side effect of the Durbin Amendment that increased the cost for them to process debit card transactions.

The Durbin Amendment was aimed at lowering the cost for retailers to swipe debit cards. Card issuers, however, have raised the previously discounted amount on items that cost less than $10 in order to recoup the revenue lost in the cap on more expensive items.

"If they keep raising the fees, then we'll have no choice but to raise our prices," Su-Lin Hsieh said, TwinCities.com reports.

Last month, Hsieh’s business saw interchange fees consume close to 3.8 percent of revenue. Next month, she said she's expecting it to cost at least four percent.

Chris Stave, the executive director of the Vend Marketing Institute, said that the days when the fast food sector enjoyed a much lower micro rate on swipe fees are over.

"Vending machines were as low as two cents per transaction for a $1.25 or $1 transaction,” Stave said, according to TwinCities.com. “That's ended."

Other sectors have been hurt by the increase in interchange fees on small-ticket items as well.

Red Box Inc., the DVD rental vending machine company, has also been forced to increase prices in response to the Durbin Amendment, according to its parent Coinstar Inc.

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