Senate Votes To Continue With Debit Card Swipe Fee Slash

The Senate narrowly voted earlier today to defeat a measure to delay new rules that significantly decrease swipe fees, the amount of money banks charge retailers every time a debit card is used.

Starting next month, the largest banks will only be allowed to charge retailers $.12 per transaction on debit card purchases. The current swipe fee averages $.44 per transaction.

Senator Jon Tester of Montana had been leading the charge against swipe fee reform, arguing that small banks would be hurt by the rules, even though a majority of small banks (those with under $10 billion in assets) are exempt. He had initially proposed a two-year delay in enacting the new rules, but later shortened that to one. Supporters of the delay required 60 votes from the Senate but were only able to garner 54.

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.