There was a news story that came out last week stating that legislation was introduced to allow merchants and vendors to negotiate directly with Visa, Mastercard, and others, instead of having to go through the banks, thereby possibly being able to save a lot of money on credit card fees.

The measure is called the Credit Card Fair Fee Act, and it would relieve the fee that places such as restaurants and gas stations, among others, end up paying banks.

Of course the banks aren’t happy because they’re saying it cuts out a significant part of their revenue. That, and they say the merchants are whining because all of them pass the costs on to us, so they’re not really suffering.

My initial reaction was “good; sock it to those nasty banks once again.” Then I thought about it some more and realized that no matter the negotiation, there’s going to be some kind of fee, and I’m either paying the banks or the merchants for the pleasure of doing business with them. The rate merchants are being charged is between 1 and 2%; I’m charged 2.89% by Paypal for any services or products I happen to get paid for, and only this year have thought about raising my prices enough to help cover that fee, so I get all I have coming my way.

Another thought I had is that with it going through banks right now, it means there’s somewhat of an even playing field. For instance, I can’t see Mother’s Restaurant down the street having the clout to negotiate anything with the big credit card companies, but Burger King, who does take credit card payments, could reap big savings, and yet still not lower its prices on anything. Who would know?

So, this bill, which was actually initially discussed back in November when things were really bad, amounts to a lot of talk about a lot of nothing for the majority of us; at least that’s how I see it. I could be wrong; what are your thoughts on it?

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