MEASURING SOME EFFECTS OF THE 2011 DEBIT CARD INTERCHANGE FEE REFORM

Authors

  • OZ SHY

    1. Senior Economist, Research Department, Federal Reserve Bank Boston, Boston, MA 02210
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    • I thank two anonymous referees, Kevin Foster, Kate Fritzsche, Geoff Gerdes, Fumiko Hayashi, Marcin Hitczenko, Suzanne Lorant, Marc Rysman, Scott Schuh, and Robert Triest for comments and suggestions on earlier drafts. The views expressed in this article are those of the author and do not necessarily represent the views of the Federal Reserve Bank of Boston or the Federal Reserve System.


Abstract

In October 2011, new rules governing debit card interchange fees became effective in the United States. These rules limit the maximum permissible interchange fee that an issuer can charge merchants for a debit card transaction. Using new data from the Federal Reserve of Boston, Richmond, and San Francisco 2012 Diary of Consumer Payment Choice, this article provides simple calculations that identify the transaction values by consumer expenditure category for which interchange fees became higher and lower under the new rules. (JEL G28)

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