The Durbin Amendment's capping of debit interchange rates has saved consumers up to $18 million per day, according to a retail group that strongly backed the cap.
The amendment will mark its one-year anniversary next week.
The National Retail Federation, a retail group argued competition between retailers has meant that the interchange cut has brought savings to consumers.
“Merchants haven’t necessarily labeled the savings from reform as a ‘debit discount’ but they have nonetheless found a variety of ways to pass the value along to their customers,” NRF President/CEO Matthew Shay said. “Depending on the store, shoppers are paying lower prices, getting better service or avoiding prices hikes that otherwise would have come with inflation.”
“Retailers are simply too competitive not to share savings with consumers because customer value is one of the key ways they take market share away from their competitors,” Shay said. “Retailers know that if they don’t pass along the savings the store across the street will.”
The group cited what it said were examples of retailer savings, including:
--Home Depot announcing last year that the savings went into a pool of reduced operating costs that allowed it to reduce the prices of more than 3,000 items.
--Ikea offering savings vouchers to customers who pay by debit that can be used on their next purchase.
--Some stores adding sales clerks or taking other steps to improve customer services.
--Gas stations that previously offered discounts for cash are now accepting debit cards at the same price as cash.
Financial institutions have charged that retailers pocket the debit interchange savings and do not pass costs savings to consumers.
The regulation caps debit interchange on cards issued by financial institution with over $10 billion in assets. Only four credit unions fall into this category.