Senate votes to limit debit card fees.....Wall Street frets

[marmar]

Visa, MasterCard Fall on Vote Curbing Debit-Card Fees (Update2)
By Peter Eichenbaum


May 14 (Bloomberg) -- Visa Inc. and MasterCard Inc. fell in New York trading after the U.S. Senate included limits on debit- card fees in the financial-overhaul bill and analysts said the House is likely to approve the measure.

The measure would empower the Federal Reserve to curb debit-card interchange, or “swipe” fees, charged to merchants. Visa, the world’s biggest payments network, dropped $8.96, or 10 percent, to $76.77 at 2:04 p.m. in New York Stock Exchange composite trading, and has fallen 21 percent from a record closing high of $96.59 on April 23. MasterCard fell $19.37, or 8.3 percent, to $212.94, and has slid 20 percent in three weeks.

Shares of networks and banks came under pressure last week as Senate Majority Whip Richard Durbin pushed the fee curbs. The limits may crimp revenue at Bank of America Corp., Wells Fargo & Co. and JPMorgan Chase & Co., the biggest U.S. debit-card issuers. The measure cleared the Senate because of the industry’s “terrible” attitude toward merchants, Durbin said.

“They do things that are just totally indefensible,” Durbin said today in a telephone interview. “They really have done everything they can to suppress any competition between the two giants.” ..........(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aDFb0J81YbTo&pos=6

[jody]

1. Why doesn't congress do the moral thing and repeal S256 Bankruptcy Abuse Prevention and Consumer

Protection Act of 2005.

The bill is misnamed and should have been titled "Bankruptcy Abuse Prevention and Corporation Protection Act".

[customerserviceguy]

2. At some point

we're probably going to start paying financial institutions to use debit cards. I really don't feel like going back to a world where I have to carry a damned checkbook, or a bunch of cash.