DURBIN AMENDMENT

On October 1st, 2011, the Durbin Amendment went into effect. One of the fallouts of the implementation of this was a sharp increase in the cost of most small ticket debit transactions. See the following Fresh Cup article written by one of our staff that discusses this issue.

Fresh Cup Magazine – November 2011 – What does the Debit Card Debate Mean to Coffee & Tea Retailers

Now that we have all received our first statements (October 2011) with the Durbin impact included, you can see if you are a little or significantly impacted. Unless you are selling a lot of gift cards or are in a market with a ‘small’ bank that has considerable market presence, your bill has most likely increased significantly.

Please don’t call and holler at your merchant services provider but do VERIFY that your pricing structure both allows for the benefits of Durbin as well as the hit! As stated in the article, most debit transactions in excess of $11 will be at a lower cost. If you have ‘blended’ pricing, you may not receive those benefits without asking. If you are in a ‘cost plus’ agreement, there should be nothing for you to do beyond the efforts to increase the size of your average debit transaction to avoid fees.

It’s a bit messy and convoluted, and we fully expect some revisions to be made to the law, hopefully to the benefit of coffee shop owners and similar small ticket merchants. Please talk to our sales staff if you want to hear more about how we can help you reduce debit and credit card fees. If you are already a Coffee Shop Manager customer processing with one of our merchant partners, their typical agreements should have you both receiving the unavoidable hit and the benefits on larger transactions, but please review your bill in detail to confirm.