How did the Dodd-Frank Act affect retailers regarding transaction fees?

The Dodd-Frank Act included provisions specifically aimed at regulating debit card transaction fees, which are often referred to as swipe fees. One of the most significant changes introduced by the act was the cap on debit card swipe fees, limiting these fees to a maximum of 21 cents per transaction for debit card payments. This cap was intended to reduce costs for retailers, allowing them to keep more of the revenue from debit card transactions instead of paying high interchange fees to banks and card networks.

Understanding the impact of this cap is crucial for retailers, as it directly affects their profit margins when customers choose to pay with debit cards. Before the Dodd-Frank Act, some banks charged significantly higher fees for these transactions, which presented a considerable expense for retailers. By establishing a limit, the act aimed to create a fairer and more transparent pricing environment for debit transactions.

The other options do not accurately represent the changes made by the Dodd-Frank Act regarding transaction fees. For instance, the act did not eliminate all transaction fees nor did it focus on credit transaction fees, nor did it introduce any requirement for retailers to notify customers of fees. Thus, the capped debit card swipe fee at 21 cents is indeed the most accurate reflection of the changes brought about by