What is the Durbin Amendment and what does that mean for you the merchant?
The Durbin Amendment was proposed by Sen. Richard Durbin (D-IL) as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 to place a cap on interchange or transaction fees.
Supporters of the legislation considered the fees excessive as the average fee being charged per debit card transaction was 44 cents. Those in opposition worked hard to defeat the bill, but after much debate, the final rule was handed down and it went into effect on October 1, 2011.
Originally a cap of 7 to 12 cents per transaction was proposed. However, the final cap approved was 21 cents plus 0.005% and an additional 1 cent for institutions employing effective fraud preventive initiatives.
The Durbin Amendment was put into place to ensure savings, leaving more money in your pocket. It was specifically written with merchants in mind. As long as you are on a “Cost Plus” program you be able to enjoy the benefits of the Durbin Amendment. At BinglePAY, we only price clients on “Cost Plus.” This way you can be sure you not are not being taken advantage of by your card processor and will benefit from the Durbin Amendment.
Before the Durbin, the average cost per transaction was 44 cents. After the Durbin, the average cap is 24 cents. This is a savings of 20 cents per transaction for all debit cards that qualify.
BinglePAY will provide a free cost analysis of your current pricing program to help determine if you are receiving the lower Durbin Amendment pricing. Simply fax your statements to 866-422-4009. A relationship manager will provide a proposal of savings and will let you know if you are currently receiving Durbin Amendment pricing.
BinglePAY is an advocate for fair, transparent and ethical credit and debit card processing practices and ensures every client is on a program that allows them to benefit from the Durbin Amendment.