The recently-signed financial regulatory bill will give a break to retailers who say they have suffered years of high fees on debit card transactions, NPR reported.
When people pay with plastic, about 2 cents on the dollar gets eaten up with fees. The money goes to the banks that issue the cards and to the payment networks Visa and Mastercard. It may not sound like much, but Sonja Hubbard, CEO of E-Z Mart, a chain of 300 convenience stores in the South, says it adds up fast.
"Within our company, we average almost $10 million a year ... on fees," she said.
Hubbard said it's the company's second-largest expense, right behind payroll.
She said those fees mean E-Z Mart actually loses money on small transactions such as a cup of coffee or a newspaper. She says one day a college kid came into one of her stores three times.
"The highest purchase was $2.35 and then the other two were below that," she said. "And so I thought, it's a frequent customer who you have to value was there three times in one day, and I lost money on every transaction."
Hubbard is thrilled about the amendment in the financial regulation bill that aims to rein in the fees on debit card transactions. It directs the Federal Reserve to set a new fee structure that is reasonable and proportional.
Read the full story at NPR.org.