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6 more national groups oppose Sen. interchange plan
WASHINGTON (5/13/10)—A letter opposing credit card interchange amendments to the Senate financial regulatory reform bill, and signed by leaders of six national organizations--representing African-American, Latino, women's, church and rural constituencies--was sent Wednesday to Senate leaders. The letter to Sens. Harry Reid (D-Nev.), who is Senate Majority Leader, and Mitch McConnell of Kentucky, the leading Republican of that body, said proposed interchange amendments to the Restoring American Financial Stability Act (S. 3217) could “cause financial harm to consumers, community banks and credit unions, and small business owners.” The Credit Union National Association (CUNA) has waged long-standing opposition to the efforts of some federal lawmakers to assert government interventions on interchange fees. Mirroring one of CUNA’s arguments, the coalition of national organizations wrote that credit unions, as well as community banks, “consistently report that government intervention in the interchange system could drive them out of the payment-card business, threatening the survival of these pillars of community economic activity--the vast majority of which had nothing to do with the recent financial crisis--and reducing credit availability to small business owners and entrepreneurs.” The letter was signed by: Hector Barreto, chairman of The Latino Coalition; Niel Ritchie, executive director of the League of Rural Voters; Roger Campos, president/CEO of the Minority Business RoundTable; Harry Alford, president/CEO of the National Black Chamber of Commerce; Rev. Miguel Rivera, president of the National Coalition of Latino Clergy & Christian Leaders (Coalition Nacional Latina de Ministros & Lideres Cristianos); and Dr. E Faye Williams, national chair of the National Congress of Black Women. CUNA joined other finance industry representatives last week in a letter to all U.S. senators that strongly opposed “any amendments to S. 3217 that seek to affect interchange rates and the rules established by payment card networks." Sen. Richard Durbin (D-Ill.) has filed a number of such amendments. The first would permit merchants to set a minimum or maximum transaction amount for payments by card; offer discounts for use of cash, check, debit card or stored-value card; and offer discounts to customers to use a competing card network. A second amendment would direct the Federal Reserve to issue regulations to govern interchange fees charged for debit card transactions, to assure that they are what the proposed language terms "reasonable and proportional" to the cost incurred in processing the transaction.


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