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Hensarling Legislation Undercuts Consumers and Competition

Financial CHOICE Act draft bill includes a full repeal of the Durbin Amendment.
June 27, 2016

​Washington, D.C. – Last week Rep. Jeb Hensarling, chairman of the House Financial Services Committee, released the draft of a bill that allows price-fixing of debit card swipe fees and includes a full repeal of the Durbin Amendment and debit reform. Although he’s recently spoken about his commitment to helping Main Street and ending government bailouts, Hensarling’s “Financial CHOICE Act” is aimed at doing the exact opposite.

The bill includes language favoring the interests of fewer than 2% of the nation’s largest banks and the credit-card brands over the interests of small retailers, their employees and consumers in every congressional district in the country.

According to a press release from the Merchants Payments Coalition, a group of retailers, supermarkets, restaurants, drug stores, convenience stores and other businesses advocating for a more competitive and transparent payments system: “This bill would turn back reforms that created a freer market and prevented Visa and MasterCard from price-fixing the fees their member banks charge merchants when customers swipe a debit card to buy something. Rep. Hensarling would turn the clock back six years to when financial institutions operated this ‘swipe fee’ business as a rigged market without competition.”

“Without debit reform’s competition-enhancing standards, banks would be free to return to the days of unfettered price fixing,” said Mallory Duncan, chairman of the Merchants Payments Coalition and senior vice president and general counsel at the National Retail Federation. “It’s important to remember that despite the smokescreen the big banks put up, debit reform is an incontrovertible success and should be protected.”

NACS released a statement earlier this month opposing the Hensarling proposal. To contact your member of Congress today to voice opposition to a repeal of debit swipe fee reform, please click here.