FMI – The Food Industry Association joined a coalition of merchant industry organizations representing main street businesses nationwide in urging the Federal Reserve to move forward and finalize its long-pending debit card swipe fee reform rule.
The coalition’s call comes as the Federal Reserve’s final rulemaking on debit regulated rates has remained pending for more than a year. The rule stems from the Durbin Amendment, enacted in 2010, which directed the Fed to ensure debit card interchange fees are reasonable and proportional. While the debit regulated rate was initially set in 2011, it has not been adjusted since.
FMI has been actively involved in the issue for more than a decade and played a central role in advocating for the original debit swipe fee reform. The association filed a joint petition in December 2022 requesting that the Federal Reserve initiate the current rulemaking process and submitted formal comments on the proposed rule in May 2024.
[RELATED: FMI Asks Fed To Lower Swipe Fees]
“Grocery retailers, our customers and the American economy are long overdue for debit card swipe fee reform. These fees are unreasonably high. The 2010 statute required review and adjustments to the fees that have never been made. The Federal Reserve is obligated to follow the law, finalize the rule and give the American people and main street businesses a break on these fees,” said Jennifer Hatcher, FMI’s Chief Public Policy Officer.
The merchant coalition’s letter was sent in response to a recent communication from financial industry organizations urging the Federal Reserve to abandon Regulation II rulemaking altogether. Regulation II governs debit card swipe fees and establishes the framework for the regulated rate.
FMI and its coalition partners oppose abandoning the rulemaking process, arguing that continued inaction has resulted in debit fees remaining disconnected from current market realities and cost structures.
“The Federal Reserve needs to do its job, finalize the rule and give American consumers and main street businesses some relief on these fees. Never adjusting debit fees is akin to never adjusting rush hour toll roads and cutting off all other roadways drivers could use. FMI adamantly opposes any move to abandon the critical Regulation II rulemaking,” Hatcher continued.
The merchant letter was spearheaded by the Merchants Payments Coalition, which FMI co-leads, and reflects broader concerns from grocery retailers and other merchants about the impact of swipe fees on food prices, operating costs and consumer affordability.