Financial Privacy & Security News

WASHINGTON, Oct. 8 – When it comes to credit card fees, the credit card companies win and both consumers and merchants lose.

Congress can and should change that, and should act quickly to protect consumers as soon as possible from other abuses by credit card companies by accelerating the implementation date of the 2009 Credit CARD Act, according to Ed Mierzwinski, Consumer Program Director of the U.S. Public Interest Research Group.

In his testimony before the U.S. House Financial Services Committee on Thursday, Mierzwinski urged lawmakers to vote for pending legislation that would rein in credit card “interchange fees,” the fees imposed by credit card networks on merchants accepting credit and debit cards. (Mierzwinski’s full testimony is available here - PDF)

“All consumers, even those who pay with cash and checks, pay more at the store and more at the pump because interchange fees are passed on in the overall cost of goods sold,”

Mierzwinski testified. “Worse, bank networks such as Visa and Mastercard refuse to negotiate with stores or allow them to offer consumers cheaper alternatives.”

Mierzwinski also urged Congress to pass proposed legislation to require banks to comply with the U.S. PIRG-backed 2009 Credit CARD Act by December 1, instead of February 1, 2010, when most parts of the law are slated to be implemented. (Some parts of the law do not take effect until next August.)

“The banks have been behaving badly since consumer credit card reforms were passed in May,” concluded Mierzwinski. “It makes no sense for Congress to give them a “get out of jail free card until next February or even August, before they must comply with the tough new law.”

Mierzwinski’s testimony on interchange fee reform was in support of H.R. 2382, the Credit Card Interchange Fees Act of 2009 (Peter Welch-D-VT). Mierzwinski also supported passage of H.R. 3639, the Expedited CARD Reform for Consumers Act of 2009 (Carolyn Maloney-D-NY; Barney Frank-D-MA).

#  #  #

U.S. PIRG, the federation of state Public Interest Research Groups, is a non-profit, non-partisan public interest advocacy organization.
Mierzwinski’s blog, where he comments on a variety of consumer issues, is at http://www.uspirg.org/consumer.
For more information on U.S. PIRG’s campaigns to improve Financial Security, click here.

Follow us on Twitter.

U.S. PIRG is a founding member of Americans for Financial Reform, a 200-group strong coalition comprised of the nation’s leading national, state and local consumer, labor, retiree, investor, community and civil rights organizations that have come together to spearhead a campaign for real reform in our banking and financial system.

Ed-Mierzwinskis-Testimony-for-Oct-8-2009.pdf