How Top Rated Merchant Services Can Benefit From Durbin

1. How Top Rated Merchant Services Can Benefit From Durbin Since several of you know, the Durbin amendment gives the federal government control over debit interchange rates set by the card account associations, such as Visa and Master Card. According to First Annapolis, the new rules that take effect on November 1st will impact about 70% of debit card volume. As expected, the new rates match the maximum amount made way for by the Fed for regulated issuers - 0. 05% + $0. 21 - and the current premiums will generally remain intact for exempt issuers. The new rates also allow for an additional $0. 01 with regard to debit card issuers who demonstrate certain fraud prevention standards. What this means for you is that there is a large potential to extend the revenue of your merchant services program, if your provider is top rated and has the know- how to help you enjoy the new amendment. A top rated merchant services provider should know that a $50 transaction that costs $0. 68 in interchange today will be reduced by 65% in interchange costs to $. 24 (. 05% + $. 21) come October 1st. They should also know, and should have told you, that now could be a great time to market your financial institution's merchant services program to your commercial customer base since Durbin provides a great opportunity to gain new customers by telling them how they can reduce their processing costs. It's also important to talk to speak to your current customers. For those merchants that are on interchange pass through pricing, they will see a benefit almost immediately, which means that make sure you tell them about the change. The best part is that the reduced debit interchange fees will not take away out of your net income from these merchants. As for your customers on discount pricing, they will not see a benefit unless you, or considered one of your competitor's, change their pricing plan. Remember that the limit applies only to banks with assets with $10 billion or

2. more. Smaller banks may continue to charge higher rates because they are exempt from the new charge caps. As you can imagine, there are many unethical people out there that are trying to tap into the savings your merchants will on auto-pilot see because of the Durbin amendment. That's why you should talk to your merchants and make sure they know they're dealing with some sort of bank that provides top rated merchant services. If you have not done so already, examine your client base so you can ascertain which merchants will benefit the most from the new debit interchange rates. Showing your merchants that you're producing the Durbin amendment work specifically for them will greatly increase their loyalty, and may even bring in start up company from competitors who aren't taking such proactive steps.