Rep. Randy Neugebauer (R-Texas) released the following statement today upon the introduction of his bill, H.R. 5465, To repeal section 1075 of the Consumer Financial Protection Act of 2010 relating to rules for payment card transactions, and for other purposes:
“Today, I introduced H.R. 5465, which will repeal the misguided debit swipe fee reforms introduced by the Dodd-Frank Act. Section 1075 of the Dodd-Frank Act, commonly called the Durbin Amendment, represents an egregious example of the Federal government picking winners and losers. Simply put, it represents crony capitalism at its worst.
“Prior to Dodd-Frank, merchants, banks, and payment networks were free to enter into contractual relationships to set certain fees for processing debit card transactions. Sen. Dick Durbin (D-Ill.) and the retail lobby sold Congress on the need for debit swipe fee reform under the guise that consumers would see significant savings if the government controlled the price of these transactions. Instead, several studies, including research from the Federal Reserve Bank of Richmond, have definitely shown that consumers have not received any passed-through savings. Some studies have even shown that these price caps have resulted in reduced free checking accounts and higher minimum balances for consumers. Further, some small businesses and those with a high volume of small-dollar transactions are actually fairing worse with the price caps in place – a strange twist for the retail industry, which was lobbying so hard for the Durbin Amendment’s adoption.
“What the Durbin Amendment did do was artificially shift over $30 billion in revenue from one industry to another. Instead of promoting free market principles and technological innovation, such as enhanced data security capabilities, the Durbin Amendment was nothing more than a government action to manipulate the marketplace. Today, I am pleased to push for repeal of these misguided reforms. This legislation will restore competition in the marketplace, remove arbitrary government price caps, and ensure consumers have affordable access to basic banking services. I look forward to working with Chairman Hensarling (R-Texas) and my colleagues on the Financial Services Committee during consideration of the Financial CHOICE Act to ensure these important reforms make it across the finish line.”