League Supports 'Stop-and-Study' Legislation for Fed's Debit Interchange Proposal

Comment Deadline 

Rep. Blaine Luetkemeyer, R-Mo., introduced the Secure Payments Act (H.R. 7531), which would stop the finalization of the Federal Reserve’s proposed debit interchange proposal. Credit unions strongly oppose the Fed’s proposal, and the introduction comes as almost 6,000 credit union advocates are in Washington, D.C., for the 2024 Governmental Affairs Conference.

The Fed’s proposal would make changes to update all three components of Regulation II’s interchange fee cap based on the latest data reported to the Board by large debit card issuers. H.R. 7531 would stop implementation until a study assessing the proposal’s impact on consumers’ access to low-cost or free checking accounts, fraud prevention, and merchants’ costs of accepting debit cards can be conducted. It would also require a quantitative impact analysis on the proposal’s impact on small depository institutions and the availability of debit and banking products to low-income communities.

The Federal Reserve recently extended the comment deadline on its interchange proposal to May 12, 90 days beyond the original Feb. 12 deadline. Your League will comment on the proposal. We'll also engage with Virginia's Congressional Delegation in support of H.R. 7531.

“We welcome the introduction of this legislation because we understand that credit unions will be negatively impacted should the Federal Reserve Board adopt the rule it has proposed. The fraud costs our credit unions are facing continue to mount and we must have fairness in the system,” said League Chief Advocacy Officer JT Blau. “When implemented almost 13 years ago, the debit interchange fee cap had an impact on every financial institution, not just those issuers with $10 billion or more in assets. Studies over the past decade show that the price cap imposed on debit interchange fees is a failed policy that’s had a disastrous impact on the cost and availability of basic banking services, harming low- and moderate-income Americans.”

Read the Proposed Rule

View H.R. 7531