Senator Roger Wicker has proven his support of small business when he casts his votes in Washington, D.C. Small business owners throughout the state have recently been urging Sen. Wicker to stand up for them in the debate over swipe fee reform and to oppose any effort to delay or repeal the bipartisan reforms that were passed last year, and are scheduled to be enacted later this summer.
“Debit card swipe fees are a huge expense item for restaurants, especially those restaurants that have lower guest check averages,” said Mike Cashion, Executive Director of the Mississippi Restaurant Association. “The average restaurant operates on about a 4% profit margin. A $.40 swipe fee on $7.00 guest check is 5.71% of the transaction. Even quick service restaurants are seeing an increase in the number of debit transactions. These type of excessive fees will only serve to further erode the bottom lines of restaurants that are already reeling from the effects of a three-year soft economy.”
For years, small businesses have struggled with excessive debit card swipe fees that hurt merchants and drive up prices for consumers. The current system is broken – but last year Congress took critical steps to repair the system and put important protections in place that would reign in excessive swipe fees for debit card transactions – making them “reasonable and proportional” to the actual cost of transaction processing. These reforms allow small businesses: 1) to set a minimum purchase amount for using a debit card; 2) to allow small businesses to offer discounts to consumers who use a less expensive means of purchase, like cash; 3) to require swipe fess to be reasonable and proportional. Over the past ten years, the cost of processing a debit or credit card has decreased, but fees associated with them have increased.
Now, months before the bipartisan reforms are set to take effect, credit card companies and huge banks are lobbying to repeal or delay these reforms. Senator Jon Tester (D-Montana) filed an amendment to a small business measure (S. 493) currently on the floor that would delay reform.
“Congress got it right last year when they passed reasonable reforms that would help Mississippi’s small businesses and consumers,” said Chris Register, owner of Bop’s Frozen Custard in Brandon. “Now, I hope we can count on Senator Wicker to oppose efforts to delay implementing reform.”
For small business owners in Mississippi and across the country, properly implementing the reforms passed last year will enable them to grow their businesses, offer better pay to employees, or pass savings on to their customers. A delay transfers money through fees – $33 million per day, $1 billion per month and nearly $14 billion every year- from businesses across the country to credit card companies and banks.
“As a small business owner, I have been hit hard with expensive and ever-increasing swipe fees,” said Allen Taheri, owner of A to Z Printing in Jackson. “In recent years, credit card companies have charged more while the cost to process credit cards have in fact gone down. Their fees have increased 300% in the past decade. When the Durbin Amendment was passed last year it was a huge victory for small business owners. “
These business owners are appreciative of Wicker’s past support of swipe fee reform. As our Senators prepare to cast their votes on this important piece of legislation, Mississippi’s small business owners want to urge them to finish what they started, and to protect swipe fee reform. Merchants and consumers across the country are depending on it.
Retail Industry Leaders Association Press Release