By Silla Brush - 05/13/10 11:30 PM EDT
The Senate on Thursday passed controversial legislation clamping down on fees that card issuers charge merchants, handing Senate Majority Whip Dick Durbin (D-Ill.) a major victory.
As part of debate on Wall Street overhaul, the Senate passed, 64-33, legislation championed by Durbin that drew significant Republican support. Ten Democrats opposed the legislation, while 17 Republicans crossed the aisle to support a bill that aims to rein in fees placed on debit cards.
"It is a shame that their attempt at getting back at big banks and large credit card companies has spilled over to credit unions and community banks," said Dan Berger, executive vice president at NAFCU. "This will do nothing for consumers but go straight to the bottom line of the big box stores and giant retailers."
Durbin overcame the lobbying to pass legislation that requires the Federal Reserve to issue rules on swipe fees for debit cards to ensure fees are "responsible and proportional" to processing costs. The legislation does not ban swipe card fees. Durbin had won strong backing from merchant and retail groups. Durbin said the restrictions would not apply to banks and credit unions with $10 billion or less in assets.
"It wasn't introduced as a partisan amendment," Durbin said Thursday before the vote. "I brought this because it is a small business, retail amendment that I think is valid and just."
Rep. Peter Welch (D-Vt.), who is a strong supporter of efforts to rein in card fees, praised the Senate vote.
"This momentous, overwhelming vote sends an unambiguous message to credit card companies that the American people have had enough of swipe fees and have had enough of cash register rip-offs," Welch said.
Senate Democrats opposing the amendment were: Daniel Akaka (Hawaii), Max Baucus (Mont.), Evan Bayh (Ind.), Tom Carper (Del.), Tim Johnson (S.D.), Ted Kaufman (Del.), Claire McCaskill (Mo.), Jon Tester (Mont.) and Mark Warner (Va.). Sen. Joe Lieberman (I-Conn.) also opposed the legislation.
Senate Republicans supporting Durbin's bill were: John Barasso (Wyo.), Scott Brown (Mass.), Richard Burr (N.C.), Saxby Chambliss (Ga.), Susan Collins (Maine), Mike Crapo (Idaho), John Ensign (Nev.), Mike Enzi (Wyo.), Lindsey Graham (S.C.), Charles Grassley (Iowa), Johnny Isakson (Ga.), George LeMieux (Fla.), Richard Lugar (Ind.), Jim Risch (Idaho), Olympia Snowe (Maine), David Vitter (La.) and Roger Wicker (Miss.).
Sens. Robert Byrd (D-WVa.), Kay Bailey Hutchison (R-Texas) and Bill Nelson (D-Fla.) did not vote.
"This amendment helps big merchants, but consumers will pay the price," MasterCard said in a statement.