Teacher’s Union Backs Banks On Debit Cards

By Mike Konczal You want to know how I can tell that the interchange reform in the Senate bill was a surprise story? Because the last-minute lobbying campaign against it is so obviously a thrown-together, half-baked effort by the biggest banks.

By Mike Konczal You want to know how I can tell that the interchange reform in the Senate bill was a surprise story? Because the last-minute lobbying campaign against it is so obviously a thrown-together, half-baked effort by the biggest banks.

By Simon Johnson

Debit cards were supposed to be toast. The industry started writing their obituary when financial reform targeted overdraft fees and interchange or “swipe” fees, which had made debit cards extremely lucrative for banks. So why is it that banks are now pushing debit cards like never before?  A couple years ago, the banking industry warned federal regulators that reform efforts could lead to both an increase in fees and a decrease in debit card usage.

Debit cards were supposed to be toast. The industry started writing their obituary when financial reform targeted overdraft fees and interchange or “swipe” fees, which had made debit cards extremely lucrative for banks. So why is it that banks are now pushing debit cards like never before?  A couple years ago, the banking industry warned federal regulators that reform efforts could lead to both an increase in fees and a decrease in debit card usage.

By Simon Johnson

ONLY one thing is worse than the financial industry dangling inappropriate products in front of poor customers, and that is not providing them with financial services at all. In December the Federal Deposit Insurance Corporation (FDIC) released a survey that found roughly one in 12 American households, or some 17m adults, are "unbanked", meaning they lack a current or savings account.

Charles Lewis Sizemore submits:Visa (NYSE: V) and MasterCard (NYSE: MA) took a beating Thursday as a Senate motion to delay the controversial provisions of the Durbin Amendment affecting debit card fees failed to get enough votes. The amendment would limit swipe fees to $0.12 per transaction, compared to the $0.44 that banks charge now.