When Costs Considered, Support for Government Caps on ‘Swipe Fees’ Wane
The new Dodd-Frank financial regulation law mandates the Federal Reserve cap fees business charge retailers when customers use a credit or debit card. These fees are called ‘swiping fees’.
According to a recent IBOPE Zogby poll, when respondents were asked whether or not they support “caps on the ‘swiping fees’”, overwhelmingly 66% of respondents supported this cap. Moreover, when asked if respondents supported increased regulations on bank-fees, 60% also agreed. However, these questions did not take into account the unforeseen consequences of such regulations. Laws such as these do not operate in a vacuum and thus influence other actions taken by banks, retailers, and customers. The subsequent Zogby questions reveal our preferences change when costs are considered.
When respondents were then asked if they would support capping ‘swiping fees “even if, as a consequence, banks limit the amount per transaction (For example, banks could limit each transaction to $50)” then support for these caps plummeted to 34%. Moreover, when prompted what would be the likely consequences of capping banking fees, the majority 56% of respondents answered an “increase in bank-imposed restrictions on the services” compared to only 22% who thought it would lead to “more affordable banking services with no significant changes”.
This survey reveals how consumer preference for regulation changes when the costs of such regulations are considered. In the case of bank swiping fees, it is not clear whether or not Americans believe the benefits outweigh the costs.
A 'swiping fee' is a fee that a business pays to a bank whenever a customer uses a credit or a debit card. Regulators are currently considering capping the 'swiping fees'. Would you support or oppose caps on the 'swiping fees'?
| Response | % |
| Strongly + somewhat support | 66% |
| Strongly + somewhat oppose | 23% |
| Not sure/refuse | 11% |
Do you support or oppose increased regulations on bank-fees?
| Response | % |
| Strongly + somewhat support | 60% |
| Strongly + somewhat oppose | 31% |
| Not sure/refuse | 10% |
Would you support or oppose caps on the 'swiping fees' even if, as a consequence, banks limit amount per transaction? (For example, banks could limit each transaction to $50).
| Response | % |
| Strongly + somewhat support | 34% |
| Strongly + somewhat oppose | 48% |
| Not sure/refuse | 18% |
What do you think the most likely consequences would be of capping the fees of banking services?
| Response | % |
| Increase in bank-imposed restrictions on the services | 56% |
| More affordable banking services with no significant changes | 22% |
| Not sure/refused | 19% |
| Other | 2% |
Totals may not add up to 100% due to rounding.
Read the full results from the IBOPE Zogby Poll here.
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War is Peace.
Freedom is Slavery.
Ignorance is Strength. -
I like to pay with $100 dollar bills.
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And for every hundred dollars you put in the bank, they get to loan out a thousand, and keep the interest on the thousand. The federal reserve system, how does it work?
Those fees are undeserved, and the banks are a monopoly.
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Fucking market forces, how do they work?
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Since the survey didn't bother to tell Americans about the benefits of capping fees and how that can benefit consumers through lower retail prices, how are you supposed to answer the statement of "it is not clear whether or not Americans believe the benefits outweigh the costs." Of course one-sided survey questions don't answer that question. Give Americans the full picture and then let them decide whether allowing banks to abuse these fees is a good thing or not.
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survey questions don't answer that question ？？？？ -
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I think the reason these regulations exist is due to the fees flying under the radar. How many people are even aware of the retailer paid chargers associated with a card (and its not as if the retailer is allowed to explicitly adjust cost based on payment method).
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its just amazing... "When respondents were then asked if they would support capping ‘swiping fees “even if, as a consequence, banks limit the amount per transaction (For example, banks could limit each transaction to $50)” then support for these caps plummeted to 34%."
It's framing a question to say that it WILL happen but it won't happen in a competitive world. Do you honestly think a bank would limit to just $50? It won't. They will lose customers to banks that allow bigger transactions. Banks now operate in near real time so they can ALWAYS check their available funds. That question is just wrong.
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John Q.|7.21.11 @ 12:01AM|#
"Since the survey didn't bother to tell Americans about the benefits of capping fees and how that can benefit consumers through lower retail prices,..."Sarcasm or ignorance?
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Turnkey|7.29.11 @ 10:31PM|#
"I think the reason these regulations exist is due to the fees flying under the radar..."Well, yeah, but so are the costs of, say, janitorial services. So?
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