Earlier this week the U.S. approved an amendment to the Restoring American Financial Stability Act of 2010 (S.3217) that would result in lower fees paid by colleges when students use credit and debit cards to pay for tuition and books.
Amendment S. Amdt. 3989, with a vote of 64-33, targets the “swipe fees” that banks charge merchants to process credit- and debit-card payments. The fees average 1-2 percent of a purchase.
The amendment would require the government to issue regulations to ensure that debit-card swipe fees are “reasonable and proportional” to the cost of processing transactions. In addition, the amendment would allow retailers to set minimum transaction amounts for card purchases and offer discounts to customers who pay with lower-cost cards or with cash.
As reported earlier in this blog, efforts to include an amendment to require private educational lenders to obtain institutional certification prior to making loans to students is still under consideration. Representatives from several organizations that represent financial aid administrators, lending institutions, and students continue to urge the U.S. Senate keep this student loan related-language in the bill.
Finally, several additional amendments are still in the works that could effect private student loans. These amendments include:
- An amendment from Senator Al Franken (D-MN) that would restore bankruptcy protections to student loan borrowers.
- An amendment from Senator Dick Durbin (D-IL) that would extend the newly created Consumer Financial Protection Bureau’s (CFPB) authority to banks and credits unions with assets between $1 billion and $10 billion that originate private student loans.
- An amendment from Senators Charles Schumer (D-NY) and Jack Reed (D-RI) that would enhance CFPB enforcement over non-bank entities that extend credit or make loans. A vote on the final version of the bill is expected some time next week.