U.S. Senator Dick Durbin Discusses Debit Changes in Quad Cities

By:  Angie Mitchum
WQAD Quad Cities

On October 1st, small businesses owners will get a break from banks that charge them when customers use debit cards.

U.S. Senator Dick Durbin visited the Quad Cities Friday to discuss the new rules, which he created and passed last year as part of the Wall Street Reform Act.

Starting Saturday, debit card interchange or "swipe" fees will decrease dramatically, from 44 cents per transaction to about 24 cents per transaction.

Businesses have to pay the fees on every debit card sale and Sen. Durbin says for some small businesses, the fees "eat up" half their profits.

Sen. Durbin joined other small businesses owners at Rock Island Country Market to talk about how the fees will help small businesses in the rocky economy.

But there is some criticism on the news rules.

An article in the Wall Street Journal Friday says because banks will now see a cut in their revenues, they're starting to impose new fees on customers.

For example, Bank of America is joining other financial institutions by announcing that they will now charge $5 a month or $60 a year to their debit card customers in order to fill the gap.

IH Mississippi Valley Credit Union (IHMVCU) also announced Friday that it does not plan to charge monthly debit card fees. The credit union wants to reassure its 100,000 members these fees aren't heading to their wallets.

"Recent regulatory changes will make it more costly for all financial institutions to support debit card programs. But we've worked hard to find ways not to pass these costs onto our members," said Dennis Hall, president of IH Mississippi Valley Credit Union. "All too often those individuals who can least afford to pay monthly fees for basic banking services bear the weight of these new fees.