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CUNA to FOX Fed interchange plan needs work
WASHINGTON (3/16/11)—The Credit Union National Association (CUNA) took its interchange fight to local airwaves this week, telling a D.C.-based Fox affiliate that the Federal Reserve’s interchange fee reduction plan does not account the total costs of running debit card accounts. The debit-related costs incurred by credit unions include the cost of dealing with instances of debit card fraud, attempts to prevent these types of fraud from occurring, and other varied costs associated with offering debit services to their members. Fixed costs, such as network fees, also factor in to the costs borne by credit unions, CUNA Chief Economist Bill Hampel said during the broadcast. The interchange fight was also covered this week in online news source CNNmoney.com, with CUNA’s Vice President of Communications and Media Outreach Pat Keefe counting the 4,000 recent attendees of CUNA's 2011 Governmental Affairs Conference among those that have discussed the interchange provisions with lawmakers. The Fed's proposed interchange rule would set a seven to 12 cent limit on the card swipe fees charged by many debit card issuers. Credit unions and other financial institutions with under $10 billion in assets are exempt from the proposed rule, but CUNA has voiced concerns that the exemption will not work in practice. CUNA, a number of legislators, and other organizations such as the NAACP have all urged the Fed to take greater time to consider the impact that interchange fee changes could have on financial institutions and consumers. Separate bills that would delay interchange implementation were released in both the House and Senate on Tuesday.
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