WASHINGTON (3/22/12)--Consumers have yet to see the promised savings that retailers claimed would result from the new debit card interchange rule, Sen. John Tester (D-Mont.) told attendees of the Credit Union National Association's (CUNA) 2012 Governmental Affairs Conference Wednesday.
Sen. Jon Tester (D-Mont.) introduced legislation in 2011, along with Sen. Bob Corker (T-Tenn.), that would have delayed implementation of interchange legislation by two years. Shown here addressing a credit union crowd at the CUNA GAC Wednesday, Tester said credit unions do a better job at meeting consumers' needs than do big banks. (CUNA Photo)
Tester sponsored 2011 legislation to postpone implementation of the debit card interchange fee cap. The bill, which was defeated, was supported by CUNA.
"Now we certainly know that the goal of the original interchange amendment wasn't supposed to impact credit unions and community banks with assets of less than $10 billion in assets, but the facts suggest otherwise," Tester said.
The Federal Reserve Board's final rule implementing the interchange law capped large issuer debit interchange fees at 21 cents. An additional five basis points per transaction may be charged to cover fraud losses.
Tester said he receives e-mails from his constituents, who say they have not received the benefits of the new interchange rule.
"Can we say, 'I told you so,'" he said to his credit union audience.
Tester also cited the significance of the relationship between credit unions and small businesses, which he called "the backbone of America."
Citing a report from the National Federation of Independent Business, Tester said it indicated the majority of small businesses access financial services from community financial institutions.
"That's because you do a better job than the big guys in meeting their needs," Tester said.
The Montana senator repeatedly declared his commitment to serve the needs of rural Americans--and credit unions' role within that vision.
"You understand rural America and the many challenges that we face in the heart of this country," Tester said.