Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
Tester 15-mo. interchange delay is bare minimum
WASHINGTON (5/18/11)--Sen. Jon Tester (D-Mont.), sponsor of a bill to postpone implementation of a statutory debit card interchange fee cap, said on the Senate Floor Wednesday that he would adjust his proposed two-year delay to 15-months to win over critics. Tester, who along with Sen. Bob Corker (R-Tenn.) drafted S. 575 to delay the fee cap, said the adjustment would reflect feedback from some Senate colleagues that a 24-month delay is too long. “Sen. Corker and I have decided to shorten the timeframe from 24 months to 15 months,” Tester noted in his remarks. He added, however, that he considered 15 months to be the “the bare minimum” to get a study of the issues “right.” The 15-month delay would be broken into three periods: six-months to study issues surrounding government imposition of a cap on what card issuers may charge for use of the debit card system, six months for the Federal Reserve to rewrite rules to implement the Dodd-Frank Wall Street Reform provision, and three months to implement rules. Tester also used his time on the Senate Floor to underscore the devastating impact of the Fed’s currently proposed rule--capping fees at seven to 12 cents per transaction--could have on credit unions and other small, community-based financial institutions--and also consumers. He said either debit card issuers would pass costs left uncovered by the low cap on to consumers--whom Tester said can ill afford it--or risk financial problems of their own. He noted that federal and state regulators have repeatedly voiced concerns that a provision meant to exempt small issuers under $10 billion in asset from the reaches of the interchange law is unlikely to work to that end. “(Fed Chairman Ben)Bernanke just last week said he’s still not sure whether the small issuer exemption would work, saying--quote: 'There are market forces that would work against the exemption.' Chairwoman (Sheila) Bair of the (Federal Deposit Insurance Corp.) has raised similar concerns about the workability of the small issuer exemption. So has Chairwoman Debbie Matz of the National Credit Union Administration. So has the Conference of State Banking Supervisors. So has the National Association of State Credit Union Supervisors,” Tester said. Credit Union National Association President/CEO Bill Cheney said with regard to the senator’s announcement, “We support his efforts to stop the implementation of the law and study its impact--which we hope will result in new rule that will be more favorable than the current proposed rule.”


RSS





print
News Now LiveWire
16.9% of U.S. homeowners underwater, down from peak 31.4% in 2012, reports @zillow http://t.co/EbILqY1HMz
35 minutes ago
Breaking at #NewsNow: President Obama signs IOLTA bill into law. http://t.co/5N741Bygmn
2 hours ago
.@edmunds says the week between Christmas and New Year's is the busiest car shopping time of the year.
3 hours ago
.@CFPB sues Sprint for cramming 3rd-party service fees onto consumers' bills http://t.co/mhlMWqLKku
3 hours ago
#HomeDepot #databreach lawsuits consolidated in Georgia http://t.co/A4bei5z0mV
4 hours ago