A lawsuit has been filed to help business owners with debit card swiping fees.
The North Dakota Retail Association just announced its plans to take the matter to court.
“They are not obeying their own laws right now,” said Jeff Hinz, Kirkwood Ace Hardware, Owner and North Dakota Retail Association Chairman.
The suit is filed against the Federal Reserve Board of Governors and claims. Business owners across the country have paid billions of dollars more than what they think they should have.
Debit card fees and credit card fees. That’s probably the number one or two expense that merchants are dealing with,” said Mike Rud, ND Petroleum Marketers Association, President.
“So, we not only pay a credit card fee, which is high. We pay double what the rest of the world does in this country, which is unfair. But they’re also getting a transaction fee called a swipe fee. Every time that card runs, they get a fee,” said Hinz.
The North Dakota Retail association tells us that these banks are allowed to have fixed costs for their equipment, and maintain a fair profit. Although, they also say their fees aren’t proportional to the actual costs.
“We’re not talking about a little bank in town taking advantage of us. These are the big guys, that have unfairly stated the costs. And have failed to disclose that their real costs have lowered over the past 4 or 5 years. And they have not dropped the cost to us correspondingly,” said Hinz.
Hinz says banks are getting 6 times what they should for processing a debit card. Local business owners say these fees can at times, absorb their profits.
“I sell incense for 15 cents a piece. So, I’ve actually had people use their debit card for a few sticks of incense. I guess I just don’t want to turn away any business. So, again, it is what it is. You’re going to absorb it regardless. I think they could probably get by making a little less,” said Brenda Ternes, Down Home Store, Owner.
“So, is card swiping something we should be more conscious of as consumers?
I spoke with Mike Rud, and he says no,” said Andi Ahne, KX News reporter.
“No, I don’t think so. That’s become the way of life. A lot of this you’re not going to be able to stop,” said Rud.
Rud also tells us addressing this issue is long overdue.
“The Federal Reserve Board was given instructions in 2009 to monitor this. So, if they’re not willing to do that, we felt that now is as good a time as any. We need to take some action to make sure that this is getting done properly. To make sure that the retailer is being charged the right amount to process these cards, and the consumer is down the road is going to see hopefully some impact in terms of what they’re paying for prices on products they’re buying,” said Rud.”
Both the North Dakota Retailers Association and North Dakota Petroleum Marketers Association are backing this lawsuit, expect the suit to move quickly through North Dakota.
They say best case scenario is this will go all the way up to the supreme court.
Rud tells us they would like to get the cost down from 21 cents per swipe to 3 or 4.