VELOCITY MERCHANT SERVICES ON THE DODD FRANK ACT AND DEBIT CARD TRANSACTIONS

VELOCITY MERCHANT SERVICES ON THE DODD FRANK ACT AND DEBIT CARD TRANSACTIONS

The Dodd-Frank Wall Street Reform and Consumer Protection Act was passed by the 111th U.S. Congress on October 1, 2011 to help alleviate problems during the economic meltdown of the late 2000s. One provision of the bill is the Durbin Amendment, which regards debit card transactions. It has been said that this amendment led to unintended consequences, such as several banks closing their free checking account programs.

VELOCITY MERCHANT SERVICES ON THE DODD FRANK ACT AND DEBIT CARD TRANSACTIONS

The Dodd-Frank Act put a cap on how much the banks that issue debit cards may charge a retailer for the use of a debit card at their store. The Act set the cap at 21 cents a transaction, plus .05 percent of the total purchase price. As banks scrambled to make up the revenue lost by this new regulation, many banks began adding $5 monthly charges to their previously free checking accounts. These kinds of new fees bring into question whether or not the Dodd-Frank Act is actually helping consumers.

ABOUT VELOCITY MERCHANT SERVICES (VMS)

VMS was founded by Dema Barakat in 1998. It is an Illinois-based business that deals in debit card processing as well as credit cards, gift cards, check guarantees, and cash advances.