On July 31, a federal court in Washington sent shock waves through the merchant, banking, and credit/debit card industry by overturning the Federal Reserve's rules implementing limitations on the interchange fees banks can charge merchants for processing signature- and PIN-based debit cards. In doing so, the Judge ruled that the Fed had not reduced these fees enough to comply with the wording and the intent of Congress—and sent the rules back to the drawing board.
While this is good news for merchants and bad news for banks—or will be, once the new lower-fee rules are in place—how much the good news is worth depends on how much a debit card transaction costs, writes Legal Columnist Mark Rasch. And just as important is who gets to decide what a "cost" is.