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News Now

Washington
CUNA covers interchange in first regulatory podcast
WASHINGTON (7/18/11)--Credit Union National Association (CUNA) Deputy General Counsel Mary Dunn has covered the latest debit interchange developments, and background information on the Federal Reserve’s debit interchange fee cap, in a recently released CUNA podcast. The podcast is the first in a regular series. Future podcasts will focus on National Credit Union Administration, Federal Reserve, and Consumer Financial Protection Bureau rulemakings, as well as other related regulatory developments. The podcast covered key changes in the final Fed rule. The rule, which was released last month, would cap large issuer debit interchange fees at 21 cents, to cover network connectivity, hardware, software, and labor costs, as well as costs related to network processing and transaction monitoring. An additional five basis points per transaction may be charged to cover fraud losses. A separate interim final rule proposed would allow an additional penny to be charged if financial institutions are in compliance with Fed established fraud prevention standards. Debit card issuers with less than $10 billion in assets are exempt from the direct impact of the cap provisions. Prepaid cards and government-issued cards are also exempted. Dunn in the podcast thanked credit unions and leagues for their strong grassroots advocacy work, which ultimately changed the tenor of the Fed’s final rule. She also noted that CUNA is urging Visa and MasterCard to implement the required two-tiered system, and is working with them to ensure that they are committed to this system. CUNA will work to ensure that small issuers receive as much interchange income as possible, Dunn added. CUNA members may listen to the podcast via their Web browser or download the podcast for replay on their mobile device. The Fed is accepting public comment on the interim final rule through Sept. 30, and CUNA has released its own comment call on the rule. For the podcast, CUNA’s interchange final rule analysis, and more on interchange, use the resource links.


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