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Call on Congress on interchange CUNA urges CUs
WASHINGTON (4/5/11)—Saying that “the time has come to more aggressively reach out to credit union members to broaden the grassroots effort on debit interchange issues,” Credit Union National Association (CUNA) President/CEO Bill Cheney on Monday announced a host of new resources that will help consumers engage their congressional representatives on this crucial issue. CUNA on Monday unveiled a toll-free number, (877) 422-3525, to help credit union members urge their congressional representatives to save free checking accounts at credit unions. At issue is an interchange rule included in the Dodd-Frank Wall Street Reform Act that requires the Federal Reserve to set the fee debit card issuers may charge merchants who use that payment system. CUNA has said the rule will force up debit card costs for consumers and has urged Congress to delay implementation and study the surrounding issues. On the grassroots front, CUNA, the Leagues and credit unions are developing a district-based letter-writing campaign. CUNA will provide Leagues and credit unions with posters, sample letters, and other materials to push this effort forward. Cheney said that CUNA’s “Call on Congress” will engage credit union members and “keep up constant contact with their lawmakers –both in Washington and at home.” The interchange provisions, which could become effective in late July, could lower the amount of transaction fees charged to seven cents per card swipe. The legislation would exempt credit unions and other small institutions with assets of $10 billion and under from the terms of the regulations. However, there is much debate over whether this proposed exemption would work as planned. Federal regulators, including Federal Deposit Insurance Corp. (FDIC) Chairman Sheila Bair, have publicly questioned whether small issuers would benefit from this exemption. Fed Chairman Ben Bernanke this week said that his agency would not be able to meet a statutory April 21 deadline for the issuance of proposed debit interchange fee standards. The new standards are currently set to go into effect on July 21. “If the rules proposed by the Federal Reserve to fix prices on debit interchange go into effect July 21 as mandated by law, many credit unions will have some very hard choices to make about how to offer services to their members,” said CUNA’s Cheney. “Credit union members may be forced to pay new fees for their debit cards and face elimination of services such as free checking.” CUNA has called on legislators to “stop, study and start over” on the interchange proposal. Legislation to delay the implementation of the interchange proposal is active in both the House and Senate, and credit union backers have made more than 50,000 separate contacts in support of these delays since March 15. Rep. Shelley Moore Capito’s (R-W.V.) bill would delay interchange rate cap implementation by one year while the Fed studies interchange’s impact on consumers, credit unions and merchants. That legislation has 68 cosponsors. Sen. John Tester’s (D-S.D.) bill, which would order a similar study and would delay implementation by two years, has 17 cosponsors. For more on CUNA’s grassroots actions, use the resource link.


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