Contrary to assurances made during the debate running up to theDurbin amendment, new research from the Electronic Payments Coalition charges that merchants have notbeen passing debit interchange savings on to consumers.

The Durbin amendment, named for its chief sponsor, Sen. RichardDurbin (D-Ill.), capped debit card interchange for card issuerswith over $10 billion in assets.

The Electronic Payments Coalition is an association of banks andcredit unions that opposed it.

The EPC outlined its research in a report titled “Where'sthe Debit Discount?” and described how researchers visitednational chain retailers in six U.S. cities, Washington D.C.;Boston; Little Rock, Ark.; Atlanta; Portland, Maine, and SanFrancisco.

The stores visited were from the Wal-Mart, Walgreens, 7-Elevenand Home Depot chains and each chain had lobbied in favor of theamendment.

Researchers visited stores in these cities four times, once inthe week before regulations implementing the cap went into effectand three times after the Oct. 1 implementation date.

The shopping teams purchased the same basket of goods each timeand averaged the prices in the three post-implementation visitswith the prices they found in the one pre-implementation visit.

When the prices were compared, the research teams found that 12of the 21 stores visited raised prices on the items after theinterchange cap went into effect, by an average of 5.1%. Four ofthe 21 kept prices the same and only five of the 21 stores loweredprices, by 5.8%

In percentage terms, the EPS said that 76% of retailers visitedeither raised prices or kept them the same after they began to seeadditional income from the debit cap and only 23% loweredprices.

The bottom line, the association said, was that consumers paid1.7% more, on average, for the same items in stores after the debitcap was put into effect than they did before.