John established a merchant account with his business banking manager at the local national bank in order to accept credit card payments. With the passing of the October 2011 Durbin Amendment his processing fees remained unchanged. It was only when John asked Swipe Merchant Services to review his processing statements that he realized his local bank had raised his processing rates in order to offset the savings he should have received from the 2011 Durbin Amendment.
Swipe explained to John that the Durbin Amendment expanded the Federal Reserve powers for setting interchange fees related to debit card transaction processing. By lowering these fees, the ultimate goal was to spur economic growth. Theoretically, merchants could lower prices on consumer goods. John’s bank however did not pass these savings along to him. Instead they lowered debit fees in accordance with the Durbin Amendment and raised additional fees resulting in zero savings to his business.
With John’s understanding of the Durbin Amendment, Swipe was able to build a processing rate structure that passed the Durbin savings along to him. In addition to saving John over $12,000 a year in fees, Swipe’s easy to read monthly processing statements provide a transparent report of what he is paying to accept credit cards.