WASHINGTON -- The U.S. Federal Reserve plans to discuss its plan to regulate debit-card interchange or "swipe" fees on June 29, according to a meeting notice on the Fed's website. At the meeting, the Fed is expected to issue final rules that would rein in the fees that banks charge retailers every time a consumer swipes a debit card at the register to make a purchase, reported Dow Jones.
Click hereto view the notice for the meeting: "Proposal Governing Debit Card Interchange [image-nocss] Fees, the Fraud Prevention Adjustment, Routing & Exclusivity Restrictions & Related Matters."
The debit card regulation, fiercely protested by the financial industry, is scheduled to take effect on July 21.
Earlier this year, Fed Chairman Ben Bernanke warned that the Fed, swamped with thousands of comments from stakeholders, would not meet an April 21 deadline for issuing new controversial rules that would cap the debit-card fees.
The Dodd-Frank financial overhaul Congress passed last summer charges the Fed with regulating interchange fees so that they are "reasonable and proportional" to costs incurred. In December, the Fed unveiled a plan to cap the fees at 12 cents per transaction, a 73% cut from the current 44-cents-per- transaction average.
The regulation is a win for retailers who have long fought the fees banks charge them. Merchants say the interchange fee system is not transparent, banks are able to dictate the fee levels and there is no room for negotiation.
Financial firms, however, could lose billions in lost fee revenue and argue that the government shouldn't be in the business of setting prices.
(Click here for previous CSP Daily News coverage.)
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