Sen. Richard Durbin (D-Ill.) is vowing to fight a renewedeffort to repeal the cap on debit card interchange fees – a part ofthe Dodd-Frank Act that is known as the Durbin Amendment.

“Repeal of the Durbin Amendment will not happen on my watch,”Durbin (pictured) said after Rep. Randy Neugebauer (R-Texas)introduced H.R. 5465, which would repeal the cap.

The cap was intended to help merchants and consumers and lower prices. Butit hasn't worked that way, according to credit unions, banks andother opponents, who said merchants failed to pass on savings to consumers. Financial institutionspraised Neugebauer's repeal legislation.

“The bottom line is this amendment introduced price-fixing to aformerly functional and competitive marketplace and failed to keepthe dubious promises made to sell it – ultimately hurtingcustomers,” CUNA, NAFCU, the American Bankers Association, theConsumer Bankers Association, the Financial Services Roundtable andthe Independent Community Bankers of America, said in a jointletter to Neugebauer and Financial Services Chairman Jeb Hensarling(R-Texas).

With the number of days that Congress will be in sessiondwindling and continued gridlock plaguing the Senate, theNeugebauer plan may not move in the current Congress, but it likelysets up a fight for next year.

“What the Durbin Amendment did do was artificially shift over$30 billion in revenue from one industry to another,” Neugebauersaid. “Instead of promoting free market principles andtechnological innovation, such as enhanced data securitycapabilities, the Durbin Amendment was nothing more than agovernment action to manipulate the marketplace.”

The bank and credit union groups said the Durbin Amendmentintroduced price-fixing to a functional and competitive system.They said the amendment was supposed to exclude small issuers frominterchange fee ceiling restrictions, but Dodd-Frank failed toinclude an exemption from costly network routing and exclusivityprovisions.

Durbin criticized efforts to reopen the fight over his plan.Instead, he accused the credit and debit card industries ofinstituting new, anticompetitive fees.

He accused Visa and MasterCard of creating new fees that wouldpenalize small banks and credit unions and deter them from doingbusiness with other card networks.

“Continued vigilance by Congress and regulators is necessary tohelp expose these rigged schemes and ensure that the credit anddebit card systems operate fairly for all Americans,” Durbinsaid.