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FREDERICKSBURG, VIRGINIA (December 4, 2012) The International Parking Institute announced today it has joined the Washington, D.C-based Merchant Payments Coalition in an effort to fight unfair swipe fees imposed by big banks and credit card companies.
The Merchants Payments Coalition is a group of retailers, supermarkets, drug stores, convenience stores, fuel stations, online merchants, and other businesses that are fighting for a more competitive and transparent card system that works better for consumers and merchants alike. The coalition's member associations collectively represent approximately 2.7 million facilities with 50 million employees.
"We're joining the Merchants Payments Coalition to strengthen our voice on an issue that is critically important to our members. Unfair price-fixed swipe fees are hurting parking businesses and customers," said Shawn Conrad, CAE, executive director of the International Parking Institute.
According to Conrad, swipe fees are increasingly relevant in the parking sector as advanced technology is making pay-by-credit or debit more common
"The Merchants Payments Coalition welcomes the participation of the International Parking Institute and its member organizations as we advocate for competition and fairness in the swipe fee market," said MPC Chairman Mallory Duncan, senior vice president and general counsel at the National Retail Federation.
"Banks and the parking industry are both examples of businesses that have made widespread use of technology to bring down their costs of doing business," Duncan said. "But banks keep raising swipe fees, wiping out the savings seen in the parking industry and driving up prices paid by consumers. The credit card companies that set swipe fees on behalf of the big banks are engaged in the kind of price-fixing that is illegal in other parts of the economy and should be illegal in the payments market as well."
Visa and MasterCard together control 80 percent of the card market, allowing them to dictate the swipe fees charged for each purchase. In the U.S., banks charge between 2 and 3 percent of every credit card purchase--equal to or even higher than merchants' 1 to 3 percent average profit margin. The fees also drive up prices for consumers, costing the average U.S. household more than $400 a year.
Read more about how the broken market for swipe fees affect businesses, consumers, and the American economy here.
Credit card swipe fees remain unregulated, but Federal Reserve regulations that took effect in 2011 cut debit swipe fees roughly in half for many transactions. However, the regulations allowed networks to raise swipe fees for low dollar purchases such as parking fees by as much as three times their previous amount. A number of merchant organizations have filed a lawsuit challenging this regulation.
Read more about debit reform here.
Sign up for a 60-minute IPI webinar led by Merchant Payment Coalition experts on Wed. Dec 12 at 2 PM ET. Learn more and register here.