WASHINGTON – Parkmobile USA has joined the ranks of its own critics, backtracking from a recent company statement tying fee increases to the controversial Durbin amendment.
The firm specializing in mobile payments for municipalities and other parking providers sparked a mini-firestorm last week when it told D.C. customers that a 40% transaction fee hike – to 45 cents – was "triggered" by the federal cap on what debit card providers charge merchants for processing. (Parkmobile has the exclusive contract for Washington D.C. municipal parking areas.)
Following the criticism, the company issued a mea culpa on Thursday, telling customers in an email that its prior explanation for the fee hike had been "overly simplistic."
The interchange cap has been a sore subject between banks and merchants since it was enacted in the Dodd-Frank Act, with the two sides fighting over how it will affect consumers. Parkmobile's stated reasoning behind its fee hike – which was announced in conjunction with a new online wallet option for customers to help them save on parking transaction costs – drew a rebuke from the Merchants Payment Coalition, saying financial companies were "falsely blaming" the debit interchange cap for their own fee increases.
Even the author of the interchange provision, Sen. Dick Durbin, D-Ill., blasted the company, charging that Visa and MasterCard are in fact responsible for such transaction fee hikes, and that a firm with a D.C. municipal contract should not weigh in about federal legislation.
But in its email Thursday, Parkmobile expressed regret for its earlier statement.
"Last week in a press release and email announcement introducing the Parkmobile Wallet, a simpler, lower cost way to pay for parking in the District of Columbia, the company made an overly simplistic statement about the underlying cause of increasing card transaction fees," Laurens Eckelboom, executive vice president for marketing and channels at Parkmobile, said in the email. "In an attempt to explain why costs have increased the company left the potentially confusing impression that federal legislation is to blame. The company apologizes for any confusion caused by this statement."