Supreme Court declines retailers' interchange challenge

Supreme Court declines retailers' interchange challenge

The US Supreme Court has rejected a challenge from retailers to the Federal Reserve's rules on interchange fees.

The court let stand a ruling from last March by the US Court of Appeals for the District of Columbia Circuit that upheld the Fed rules.

This means that interchange fees will remain capped at around 21 cents per transaction, a limit set by the Fed in 2011 in response to the Durbin amendment to Dodd-Frank.

Although the cap saw fees cut by around half, it was higher than the 12 cent ceiling proposed in earlier consultations, prompting retailers to begin legal proceedings.

In 2013 Richard Leon, a district court judge in Washington backed them, ruling that the Fed "has clearly disregarded Congress's statutory intent".

However, this was overturned by the federal appeals court, which has now been backed by the Supreme Court.

Mallory Duncan, general counsel, National Retail Federation expressed disappointment but says that the "battle over swipe fees isn't over".

"There is still litigation pending on credit card swipe fees, and policymakers continue to be concerned by the anti-consumer and anti-competitive practices of the card industry," she says.

Comments: (1)

A Finextra member
A Finextra member 21 January, 2015, 16:521 like 1 like

We are very disappointed that the US Supreme Court has made this ruling against merchants. Fundamentally, we struggle to see how a 21 cents cap can be justified when we are about to see a cap a fraction of the size imposed in Europe.

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