Rep. Frank willing to work with GOP on interchange fees

Durbin was the primary proponent of the provision, which requires the Federal Reserve to draft rules limiting the amount banks can charge retailers for swiping their debit cards. The “Durbin Amendment” was not included in the initial House version of the bill, but ultimately made it into the final version of the Dodd-Frank financial reform law.

That particular provision has set off a heated battle between banks and retailers, with billions of dollars of fees hanging in the balance. Retailers are now setting their sights on legislation imposing similar limits on credit card fees, while banks are hoping to either repeal the provision or delay its implementation by demanding further study of the issue.

Retailers have maintained that lower fees would allow them to lower costs for consumers, but Frank was skeptical, saying he was “not convinced the consumer ever sees the benefit.”

Under the Fed’s proposal, released in December, interchange fees would be slashed to somewhere between seven to 12 cents per transaction, a 73 percent drop from the current 44-cent average.

Meanwhile, Durbin appears to be holding his ground on the issue.

“Legislative attempts to change the interchange law are premature and have no chance of ever passing Congress,” Max Gleischman, Durbin’s spokesman, told Bloomberg. “The big banks and card companies hate it when they lose, so they are asking to play the game all over again.”