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During the first day of NAFCU’s 2022 Congressional Caucus, Electronic Payments Coalition (EPC) Chairman Jeff Tassey, Senior Vice President and General Counsel and Chief Ethics & Government Affairs Officer at Alliant Credit Union Meredith Ritchie, and Senior Vice President and Head of U.S. Federal Affairs at Mastercard Amanda Slater, participated in a robust panel discussion, moderated by NAFCU President and CEO Dan Berger, on credit card interchange policy.  

EPC’s Tassey kicked off the panel sharing a brief overview of the history of the Durbin Amendment, passed over a decade ago, calling attention to its harmful effects on consumers. "We're seeing a united front across financial institutions, that effort is being led by groups like NAFCU,” stated Tassey. 

NAFCU, EPC and several other financial institution trade groups have been vocal in opposing the Credit Card Competition Act of 2022 (CCCA), introduced by Senators Dick Durbin, D. Ill., and Roger Marshall, R, Kansas, earlier this summer, which aims to expand interchange price controls by creating a new credit card routing mandate, which would be a direct detriment to credit unions and their members while padding the bottom lines of big box retailers. 

The panel discussed the impact the CCCA would have on the credit unions and other financial institutions, agreeing that educating members of Congress on its impact on their constituency is of the utmost importance.  

Slater noted that consumers and financial institutions are aware and have experienced the harmful effects of this type of legislation, pointing out the decline in access to free checking caused by the Durbin amendment. “While you can put something on paper and say people are exempt from it, it doesn’t always carry over on the policy side,” added Slater. 

On the direct impact to credit unions, Ritchie stated how her own credit union was “fearful of the extension” of the Durbin Amendment, calling it “a possible erosion of revenue.” Ritchie also mentioned the confusion the bill could create among consumers, warning that the removal of interchange revenue could mean the permanent deletion of member-sought products of services. 

Tassey noted that the change in the payment routing requirement wouldn’t be a covered cost. “Construction of a global system is very expensive...you’ll be forced into arrangements with other credit networks.” 

On fraud and cybersecurity concerns, Slater explained the increasing rate of fraud losses to all parties, which has seen a steady rise since the original Durbin amendment was passed. Touching on the overall cost the bill would impose on small retailers, Slater reiterated that “From a practical point, we’d have to re-issue all the cards…and would likely see tremendous costs to small businesses, rewards...and to future investments.”

In wrapping up the panel, Berger asked what credit unions should say to lawmakers as they conduct their meetings on Capitol Hill throughout the week. Tassey first thanked credit unions for attending Caucus and urged attendees to explain to lawmakers what the expansion of the interchange legislation would have on their members, and specifically how it would disproportionately fall on minority and underserved communities.  

Slater echoed similar sentiments, specifically asking attendees to reiterate how this would affect their constituents. Ritchie urged attendees to highlight the benefits of interchange revenue, and to call attention to the reduction in fraud protection and increased consumer confusion, and ultimately the loss of revenue for financial institutions that the bill would cause.  

Berger, recently penned an op-ed denouncing this harmful bill, even telling lawmakers to repeal the entire Durbin debit interchange amendment. He underscored how the policy has failed to help consumers and has instead done nothing but pad the bottom lines of big box retailers. 

Learn more about NAFCU's advocacy on interchange fees in this issue brief.  

In addition, merchant trade groups are conducting their fly-in later this week, following NAFCU’s Caucus. Now is the best time to share your opposition to the Credit Card Competition Act by contacting lawmakers and sharing your statement on how this legislation will harm you and your members. 

NAFCU has consistently advocated against efforts that would undermine credit unions' interchange income and limit their ability to offer their 133 million members affordable financial products and services. The second day of Caucus kicks off tomorrow, view the agenda here. Follow along on Twitter with #NAFCUCaucus for live event updates.