The Federal Reserve unveiled its ruling today on the fees banks can charge merchants for processing debit cards at 21 cents a swipe. The cap is far less restrictive than the 12 cent ceiling set by the Dodd-Frank bill, but is still less than the current 44 cent average. It’s uncertain how this will affect the consumer.

Retailers promised that lower swipe fees would allow them to pass the savings on to shoppers in the form of lower prices. We’ll see if this helps at all or if they absorb the buffer.

Banks started raising fees and cutting reward programs linked to debit cards in anticipation of losing revenue. Now that the fees aren’t going to be cut as harshly as thought, will they slow those adverse plans or even reverse some of the measures? Probably not.

We’ll have to see how that plays out. But one effect of the news was noticeable and immediate: stocks of Visa and Mastercard soared:

Fed Gives In To Banks, Eases Debit Card Fee Proposal [Forbes]

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