National Association of Convenience Stores lobbyist Lyle Beckwith had some sharp words for Members of Congress on a credit card interchange fee proposal.
Beckwith took to the next level an already fierce lobbying battle between merchants and retailers over the fees for processing credit transactions: On Friday, he sent an e-mail missive to state convenience and petroleum retail association executives saying that House Members opposing the swipe fee amendment to the Wall Street bill are flipping the bird to the groups membership.
Beckwith shot the e-mail off with the subject line Interchange Enemies List. In it, he posted a Dear Colleague letter penned by Reps. Debbie Wasserman Schultz (D-Fla.) and Kenny Marchant (R-Texas), co-signed by 85 Members, asking House Members to sign on to a letter to Wall Street reform bill conferees asking for the interchange amendment to be removed.
The attached letter should OUTRAGE you!!!! The Members of Congress who are signing it should OUTRAGE YOU MORE!!! Beckwith wrote. Please see who is flipping the bird to our membership and let them know what you think!!!!!
DO IT TODAY to give them a chance to get OFF the letter!!!! he added.
The contentious issue between merchants and banks has reached a fever pitch since Sen. Dick Durbins (D-Ill.) interchange fee amendment was successfully put into the Senate version of the Wall Street reform bill. Merchants are supporting the Durbin language, which would allow the Federal Reserve to regulate the fees known as interchange fees banks and card companies charge merchants to process debit and credit card transactions. The amendment would also allow merchants to offer discounts to customers based on their payment method.
Beckwith wrote in an e-mail Monday that he stands by his Friday missive.
But Wasserman Schultz spokesman Jonathan Beeton said the merchants should be focused on consumers.
This amendment would result in increased costs for the millions of Americans who use debit and credit cards, Beeton said. Rather than being critical, retailers should be working to insure that consumers benefit.
Wasserman Schultz previously sponsored an amendment that attempted to pass along the savings to consumers by creating an arbitration panel.
The Electronic Payments Coalition spokeswoman Trish Wexler declined to comment on her opponent Beckwiths e-mail. However, she did concede that the lobbying on the issue is intense.
Everyone, particularly community banks and credit unions, are going office to office, Wexler said. The message is that people are very clear that this carve-out is not something that they asked for, and it will not help them and would put them at a competitive disadvantage.
Credit card companies such as Visa and MasterCard, along with big banks, community banks and credit unions, are fervently opposed to the measure.
Durbins language has an exemption for financial institutions with less than $10 billion in assets directed at community banks and credit unions. Still, the smaller financial institutions say the language is a red herring and it wouldnt actually help them.
Credit unions and community banks in particular have upped their presence on Capitol Hill. After a major push last week, with both major credit union trade associations flying in hundreds of their members, the Credit Union National Association is preparing for another contingent of people coming to the nations capital next week. CUNA has generated more than half a million contacts with Congress on interchange, according to the groups spokesman Pat Keefe. The group also has ads running in inside-the-Beltway publications paid for by members such as the California Credit Union League and the Texas Credit Union League.
Durbin is also keeping up the pressure on credit cards and banks. On Friday, he sent a letter to CUNA and the Independent Community Bankers of America, saying he was disappointed that the trade groups are still opposed to the measure.
The reality of your argument against my amendment seems to be that you are so fearful of Visa, MasterCard and their big bank allies that you do not believe you can support any regulation of the interchange system, no matter how reasonable, Durbin wrote. You are afraid to take what you perceive to be the risk that these giant corporations might punish you for disagreeing with them.
Durbin isnt stopping there.
He is chairing a hearing Wednesday on interchange fees as part of the Appropriations Subcommittee on Financial Services and General Government. The decision to hold the hearing follows the release of a Treasury Department report that found reforming the interchange system could save taxpayers nearly $39 million a year.
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