With the denial of certiorari putting an end to any legal recourse, retailers involved in the NACS v. Board of Governors interchange fee dispute have switched focus to their last remaining option for lowering interchange fees: convincing the Fed it should make the fees more proportionate to the charges banks and card issuers actually incur when processing debit card payments.
The Merchants Advisory Group (MAG) published the white paper “Volume and Cost Trends in the Debit Industry”, which examined debit card processing costs, finding they have fallen 42 percent to 4.4 cents per transaction, even as the Fed allowed fees to rise as high as 25 cents per transaction. MAG called on the Fed to set the fee at 14 cents. For their part, the banks have argued that merchants have not taken all the relevant costs into account, including the increasing cost of data breaches, which, they claim, are often the result of merchants’ lacking security standards.
With primary litigation now over, it is unlikely the Fed will reopen the issue of its fee swipe regulation again soon.
The White Paper is available here. Also, for background on the interchange fee dispute, check out “Related Posts” below.