Federal legislation that would permit merchants to set minimum and maximum limits on the dollar value of credit/debit card transactions they are willing to accept has yet to progress past the “pending” stage.  However, now is the time to consider the potential effect of such legislation on your business and to figure out how, if at all, you will change your operating policies in tandem with new rules.

Here’s the story in a nutshell: The limits specified within the legislation would be permitted under terms of a Senate amendment to the proposed Restoring American Financial Stability Act of 2010. The amendment also would authorize the Federal Reserve to dictate debit card interchange rates and would allow you and your fellow merchants to offer customers incentives to use cards tied to networks that impose lower rates than others. U.S. Senator Dick Durbin (D-Ill.) originally introduced these changes this past May, in a series of three individual amendments to the Act that he later consolidated into one. A similar amendment to the Act introduced in the U.S. House of Representatives does not contain provisions for credit/debit transaction limits, and the two versions are presently being put through a conference negotiation process to reconcile their differences.

State governments are also getting in on the action. For example, under the umbrella of new legislation signed into law in Vermont, merchants in that state can now impose a $10 minimum on credit card transactions. Other state legislators are said to be mulling similar moves.

Stay tuned for the second part of this series to learn from pcAmerica what else you need to know about the amendment and similar legislation.