NRF discouraged by delay of swipe-fee legislation
WASHINGTON — The National Retail Federation said legislation introduced Tuesday to delay swipe fee reform, which is scheduled to go into effect this summer, would block retailers from giving discounts to consumers who use debit cards and would cost merchants and the public more than $1 billion per month.
“We are extremely surprised to see a bill introduced that favors Wall Street banks and price-fixing card companies over Main Street merchants and their customers,” NRF SVP and general counsel Mallory Duncan said. “Merchants are ready to pass lower swipe fees along to consumers in the form of discounts and other benefits as soon as reform goes into effect in July, but we can’t do that if Congress lets bankers stand in the way.”
Sen. Jon Tester, D-Va., introduced the Debit Interchange Fee Study Act of 2011, which would postpone swipe fee reductions included in last year’s Dodd-Frank Wall Street Reform and Consumer Protection Act by two years, and would require a study of the issue. Meanwhile, some members of the House Financial Services Committee reportedly are planning to introduce a bill calling for a one-year delay and a study.
Regulations proposed by the Federal Reserve in December 2010 to implement Dodd-Frank would lower debit card swipe fees from their current level of 1% to 2% of each transaction to a flat fee of no more than 12 cents per transaction for large banks that adhere to fees set by the card companies. Banks that set their own rates would be free to charge any fee they believe the market would bear. The move would reduce the current $20 billion a year in debit swipe fees by about 70%, or $1.2 billion a month. The Federal Reserve is scheduled to issue a final version of the regulations in April, and the reforms are set to take effect in July.
NRF filed comments with the Federal Reserve in February arguing that the 12-cent cap doesn’t go far enough. NRF told officials that debit cards are merely plastic checks and should be honored at, or close to, face value since paper checks that draw on the same accounts are not subject to swipe fees. Banks’ own filings with the Federal Reserve claim only 4 cents as the cost of processing a debit transaction.
“The banks and card companies claim they want to study swipe fee reform, but the truth is they want to kill it,” Duncan said. “Congress has already conducted more than half a dozen hearings on this issue, and the [Government Accountability Office] and Federal Reserve have done studies of their own. The time for study is over. The time to reduce these fees and take bankers’ hands out of consumers’ pockets has come.”
Safeway elects new board member; declares quarterly dividend
PLEASANTON, Calif. — The former chairman and CEO of Dreyer’s Grand Ice Cream has joined Safeway’s board of directors.
The appointment of T. Gary Rogers will expand the retailer’s board of directors from nine to 10 members.
"Gary’s vast experience as a supplier to the grocery industry, his business acumen and experience as a director will be great assets to the board," said Steve Burd, Safeway chairman, president and CEO. "We are pleased he is joining our board."
Separately, Safeway also declared a quarterly dividend of 12 cents per share, which will be payable on April 14 to stockholders of record at the close of business on March 24. Prior to this announcement, the retailer declared the same dividend amount in December 2010.
Atico recalls holiday rattle baby slippers
WASHINGTON — Atico International USA issued a voluntary recall of 57,000 holiday rattle baby slippers amid a choking hazard, according to the Consumer Product Safety Commission.
The CPSC reported that the soft shoes with built-in rattles were imported from China by Atico International USA of Fort Lauderdale, Fla., and sold nationwide at Walgreens stores from October 2010 through January 2011 for about $5.
Atico received one report of a 7-month-old baby that was found beginning to turn blue with the slippers’ stuffing in the child’s mouth. The baby’s father removed the stuffing. Two additional reports of babies wearing the slippers who pulled on the rattle/stuffing and the stuffing came out also were reported. No injuries were reported.
Consumers should stop using the slippers immediately and should return them to any Walgreens location for a full refund.