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Senate House bills would delay Fed interchange plan
WASHINGTON (3/16/11)—Credit Union National Association (CUNA)
Sen. Jon Tester (D-Mont.), shown here addressing CUNA’s 2011 Governmental Affairs Conference this month, introduced legislation Tuesday that would delay the effective date of a Dodd-Frank Act interchange rule by two years, to allow for more time to study its impact. (CUNA Photo)
President/CEO Bill Cheney said last night that the proposed interchange delays introduced in both the Senate and House Tuesday give credit union members and other consumers “a ray of hope that the debit card programs they have come to appreciate may continue unchanged, at least for the short term.” He urged House and Senate lawmakers to support the legislation that would extend the rulemaking timeline and effective date of proposed interchange fee regulatory changes. The Senate bill (S. 575), introduced by Sen. Jon Tester (D-Mont.), would establish a two-year delay for the Federal Reserve’s proposal to implement the Dodd-Frank interchange provisions, which limit debit card interchange fees. It would require the Fed, the National Credit Union Administration, the Federal Deposit Insurance Corp., and the Office of the Comptroller of the Currency to submit a study on the impact of any proposed interchange rule changes to the Senate Banking Committee and the House Financial Services Committee. The study would address the impact of the rules on credit unions and other debit card issuers, merchants, and consumers. The legislation, the Debit Interchange Fee Study Act, was co-sponsored by Sens. Bob Corker (R-Tenn.), Jon Kyl (R-Ariz.), Ben Nelson (D-Nev.), Tom Carper (D-Del.), Pat Roberts (R-Kan.), Chris Coons (D-Del.), Mike Lee (R-Utah) and Pat Toomey (R-Penn.). The House bill (H.R. 1081), introduced by Rep. Shelly Moore Capito (R-W.V.), would delay the interchange rule effective date for one year and would also direct federal agencies to study the impact that interchange changes would have on credit unions and other card issuers, consumers, and merchants. The bill would require the Fed to write new interchange regulations within four months if the study were to find that the proposed exemption for financial institutions with under $10 billion in assets would not be effective. The regulations would also need to be rewritten if the study found that the Fed’s proposal did not encompass all debit card-related costs or would harm consumers. “We very much appreciate the support both Rep. Capito and Sen. Tester have given to credit unions and their members. The legislation they have championed are important steps in the process of ensuring that, ultimately, seamlessly acceptable debit cards will continue to be available to credit union members at the lowest cost and the highest efficiency,” Cheney said in appreciation of the lawmakers’ efforts. He added,“We have a long way to go in this process, but credit unions and their members are much better positioned today than we were not so long ago, and particularly before we brought 4,000 credit union folks to town two weeks ago to make our voices heard on Capitol Hill.” Cheney was referring to the credit union representatives who participated in CUNA’s 2011 Governmental Affairs Conference here from Feb. 28-March 3, a regular part of which are visits with federal lawmakers to discuss key credit union issues. In addition to Moore Capito, House sponsors of the delay include Rep. Debbie Wasserman Schultz (D-Fla.), as well as 26 of their colleagues: Reps. Blaine Leutkemeyer (R-Mo.), Jim Renacci (R-Ohio), Ed Perlmutter (D-Colo.), Jeb Hensarling (R-Texas), Ed Royce (R-Calif.), Francisco Canseco (R-Texas), Randy Neugebauer (R-Texas), Michele Bachmann (R-Minn.), Gregory Meeks (D-N.Y.), Tom McClintock (R-Calif.), John Carney (D-Del.), Bob Gibbs (R-Ohio), Gary Peters (D-Mich.), Wally Herger (R-Calif.), Ken Marchant (R-Texas), Mike Kelly (R-Pa.), Roscoe Bartlett (R-Md,), Jason Chaffetz (R-Utah), Larry Kissell (D-N.C.), Gary Miller (R-Calif.), Dale Kildee (D-Mich.), Carolyn McCarthy (D-N.Y.), Jared Polis (D-Colo.), Gerry Connelly (D-Va.), Bill Owens (D-N.Y.), and Lynn Woolsey (D-Calif.). The interchange provisions, which under Dodd-Frank are scheduled to be made final in April and effective in late July, could lower the amount of transaction fees charged to seven cents per card swipe. CUNA has repeatedly suggested that the Fed should work with Congress to delay interchange regulation implementation to allow more time for consideration of how the interchange regulations would impact credit unions, as well as consumers. CUNA has created a grassroots action alert to encourage credit union nationwide to contact their legislators to urge support of the House and Senate bills. For CUNA’s action alert, use the resource link.


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