WASHINGTON (8/18/08)--The Credit Union National Association (CUNA) has suggested a series of questions with specific relevance to credit unions that should be explored as part of a Government Accountability Office (GAO) study on interchange fees that was requested recently by three U.S. Senators. “These questions focus on the challenges small card-issuing financial institutions face in working with the card networks to ensure interchange is balanced to support their continued administration of card programs,” explained CUNA President/ CEO Dan Mica in a letter to Sens. Tom Harkin (D-Iowa), Benjamin Cardin (D-Md.) and Olympia Snowe (R-Maine). Last month the three senators asked the GAO to study the interchange issue to help them better assess pending legislation that would regulate interchange rates. Questions that CUNA suggested the GAO consider include:
* How small institutions, such as credit unions, would offset costs if interchange were capped by regulation or legislation; * How new restrictions would affect small institutions’ ability to offer credit and debit cards; * What options do small financial institutions have to increase the interchange fee associated with merchant card acceptance; and * How the ability of merchants to negotiate interchange affect card acceptance and competitive balance in the marketplace?
The Credit Card Fair Fee Act (H.R. 5546) has passed the House Judiciary Committee and a companion bill, S. 3086, has been introduced in the Senate. CUNA opposes the legislation, saying it would adversely affect consumer options, competition and technology innovation. Use the resource link below for the full text of CUNA’s Aug. 14 letter.