HARRISBURG, Penn.–Patrick Conway, president and CEO of the Pennsylvania Credit Union Association, has authored an op-ed that has been distributed to media across the state that calls for repeal of the Durbin Amendment.
The op-ed was distributed at the same time the House Financial Services Committee passed a bill that would repeal Durbin.
The Durbin Amendment, wrote Conway, has “limited the ability to innovate within the payments industry, which not only hurts Pennsylvanians but also consumers nationwide. Enacted in 2011, this legislation placed price controls on the fees retailers pay to accept debit card transactions, known as interchange fees. This reduced financial institutions’ interchange revenue by six to eight billion dollars annually.”
In the op-ed Conway explains the behind-the-scenes role of interchange fees and notes that “these funds are especially imperative to address security issues. While financial institutions are working hard to implement features such as chip cards, tokenization, and biometrics, other industries—such as retail—are falling behind in those efforts.”
The op-ed points to the “lax security” that has led to data breaches at numerous businesses, but says it’s credit unions and banks that end up bearing the costs.
“Even though retailers continue to put profits ahead of their customers, by failing to pass on Durbin Amendment savings, shirking data security responsibilities, and ignoring critical security upgrades, financial institutions are still working to protect their customers to the best of their abilities,” wrote Conway. “We can’t afford erroneous policies to continue to hurt those so closely intertwined with economic growth and success. We are proud to support Pennsylvanians in achieving their dreams—whether it be starting a new business, saving for college, or securing a mortgage—but the status quo makes it difficult for us to best serve our customers.”