NEW YORK (9/27/11)--Visa Inc. and MasterCard Inc. plan to increase the fees merchants pay for small-ticket debit purchases to the full amount allowed under the Federal Reserve's new rules that take effect Oct. 1, said analysts interviewed by Bloomberg News and The Wall Street Journal (Sept. 23) . The move could discourage some merchants from accepting debit cards for small transactions. The world's largest payments networks may increase fees from eight cents for a $2 purchase to 23 cents, Thomas McCrohan, analyst at Janney Montgomery Scott LLC, told the publications. The move could result in a backlash from "mom and pop" merchants such as coffee shops, which process a lot of $3 transactions, said Bloomberg News. A second analyst, John Kraft with D.A. Davidson & Co. said Visa plans to increase its rate for some small ticket transactions to an amount equal to the Federal Reserve's cap. Although Visa and MasterCard have not officially announced these specific increases, they have indicated they would change interchange fees on debit cards in response to the Federal Reserve's rules finalized in June and mandated by the Dodd-Frank Act. The rules limit the fees merchants pay for a consumer's debit card transaction to 24 cents per transaction. The cap applies to banks with assets of $10 billion or more. Both Visa and MasterCard met in August with the Credit Union National Association on debit card interchange fee issues concerning credit unions and indicated then they would implement a two-tiered debit interchange fee structure (News Now Aug. 24). MasterCard told the Journal Thursday that it recently informed banks it will implement a "two-tiered interchange structure" for debit and prepaid cards for issuers affected by the cap and those that are exempt. And a Visa spokesman said the company had notified clients of some rate changes. Atlanta-based payments processor First Data Corp. sent clients a notice earlier this month saying that Visa will increases prices for small-ticket debit transactions subject to the new rate caps to a price that would equal 0.05% of the transaction amount, plus 21 cents and a one-cent adjustment for fraud costs. The Journal noted that any increase for small ticket transaction fees would not likely affect all merchants equally because fees vary depending on the type of retailer and volume of card purchases.