WASHINGTON—NAFCU has joined with several other financial services industry trades in urging the Federal Reserve to offer an extension of the comment deadline for its proposal to make changes to Regulation II, which covers debit card interchange fees and network routing exclusivity.
The Fed has proposed that debit card issuers should enable, and allow merchants to choose from, at least two unaffiliated networks for card-not-present transactions, such as online purchases. The proposal does not make changes to interchange fee pricing.
In the letter, the group noted the complexity of the proposal and stated it will take time for each organization to gather information from its members. The group also explained that a lack of regulatory analysis in the proposal makes it difficult for the organizations and consumers alike to analyze the effects of the proposal, or to comment without first conducting significant analysis of their own.
NAFCU noted it has previously argued the Durbin Amendment should be abandoned as it was supposed to benefit consumers with lower prices. “However, there is no evidence that merchants have passed along their savings to consumers in the form of price cuts, and the regulatory burden and loss of revenue for banks and credit unions has led to industry consolidation and the difficult choice to charge for services that were once free, such as checking accounts,” the trade association said.