MANCHESTER, U.K.—A new report indicates that capping credit card fees would save U.S. retailers $15 billion annually.
The study from CMS Payments Intelligence comes at a time when retailers are increasing their focus on credit card fees, much like they did with debit—eventually leading to the Durbin Amendment.
U.S. credit card charges are currently considered the highest worldwide. The report suggests that the new credit card interchange cap should be set at 22 cents per transaction plus 30.5 basis points for covered issuers, PaymentWeek.com reported.
“While the federal appeals court ruling was positive, the uncomfortable fact remains that U.S. merchants large and small are still paying excessive credit card interchange fees,” CMS CEO Brendan Doyle told the website following the recent decision of a federal appeals court to dismiss the $7.25 billion proposed settlement between countless retailers and Visa and MasterCard. “Many other jurisdictions have regulated credit card interchange fees but the U.S. has yet to do so, meaning that credit card interchange fees in the U.S. average close to 2% of the transaction value and are currently among the highest in the world.
“What regulators now need to do is to go a step further and regulate these fees too,” continued Doyle. “Contrary to what card industry representatives believe, our analysis shows that this regulation framework would not threaten the existence of credit card issuers but would provide $15 billion of annual savings for merchants and consumers.”