Heartland Payment Systems, one of the nation’s largest payments processors, released state-specific data about the effects of swipe-fee reform, known as the Durbin amendment, on business owners in various states.
The data Heartland collected between October 1, 2011, and October 16, 2011, across Heartland’s portfolio of 250,000 merchant locations shows for every $100,000 of Visa and MasterCard signature debit and credit card volume processed, the average savings per merchant across all states is $260.24.
Merchants in Washington, D.C., received the highest average savings, $333.94, while Montana merchants saw the least average savings, $127.87, Heartland reported on its website. The savings variance from state to state is a result of the number of large versus small banks in the area, as well as the mix of credit and debit card volume processed, Heartland said.
The figures represent the averages of actual credit versus debit and regulated versus non-regulated debit transactions for Heartland merchants and do not include the impact of PIN debit volume, the company pointed out.
“Merchants are wondering how the percentage of regulated versus non-regulated transactions in their states would impact their savings, and this data provides insight into exactly that,” said Bob Baldwin, Heartland’s president. “By providing business owners a frame of reference for how much money, on average, their peers across their state are saving from Durbin, they have an idea of what their own savings may be. Familiarizing themselves with this information is a preliminary step in ensuring they receive the full benefit of the reform.”
The Durbin amendment was proposed by Sen. Richard Durbin (D-Illinois) as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 to place a cap on interchange or transaction fees.
The average fee of 44 cents per debit card transaction charged to merchants by the card brands was considered excessive by supporters of the legislation. Those in opposition worked to stall or defeat the bill, but after much debate and a failed bill to delay interchange regulation, the final rule was handed down in late June. It went into effect on October 1, 2011.