According to PaymentSource, the National Restaurant Association is lobbying to reduce their credit card processing fees as part of future Coronavirus-related legislation.
According to the article, the National Restaurant Association is currently battling the Electronic Payments Coalition, largely consisting of banking institutions and card associations, for these changes. In our experience, anyone taking on the credit card or banking industry typically loses.
However, one notable exception occurred immediately after the 2008 financial crisis. As part of the Dodd-Frank Wall Street Reform and Protection Act, Senator Dick Durbin added what became known as the Durbin Amendment. The National Association of Convenience Stores was one of the main lobbying groups responsible for pushing through the Durbin Amendment, which capped some debit card transactions at the discretion of the Federal Reserve. The Amendment survived a repeal attempt nearly ten years later. Still, ironically it has harmed many of the same merchants it intended to help.
During the pandemic, restaurants remain one of the hardest-hit industries outside of the travel industries. Virtually all restaurants are closed for dining and have to rely on take-out and delivery orders solely. Most restaurants have seen their sales nosedive over 70% from lack of inside dining. Restaurants not previously set up for direct delivery have partnered with delivery apps, only to have to pay commissions of 30-40% of sales to those apps. Many restaurants have already permanently closed, and most others are hanging on by a thread.
Other than rent, labor and food supplies, merchant processing equipment, and card fees remain one of the most substantial monthly expenses for the restaurant industry. With net profits at or around 10% during good times, we know that every penny counts. We wish them the best of luck while they battle the big banks and card associations. Until then, restaurants should contact IdealCost.com to reduce their fees.
Don’t Take On the Credit Card Processors Alone
Since 2009, IdealCost.com has helped hundreds of companies nationwide reduce their merchant account fees through identifying and fixing hidden profit, overcharges, fake fees, and billing errors. Clients have saved $300-$20,000 per month on their credit card processing fees without going through the hassle of changing their processing vendor, bank, or equipment. Switching credit card processors should be a last resort, only reserved for funding delays, poor customer service, or technical difficulties. Before you consider switching credit card processors, see if you qualify for IdealCost.com’s monthly savings program. Upload your most recent merchant statement for a free analysis. You’ll receive an estimate within 24 business hours.
If you are opening a new credit card processing account or switching credit card processors, please contact us for a free consultation. IdealCost.com can help secure the best terms and fees based on your specific needs.