WASHINGTON—NAFCU is again telling Congress that the Durbin rules are not having their desired effect—passing merchant interchange savings along to consumers in lower prices—and is asking for the law’s repeal.
In a letter to House Speaker Paul Ryan (R-WI) and House Democratic Leader Nancy Pelosi (D-CA), NAFCU Vice President of Legislative Affairs Brad Thaler pointed to what he called the “devastating impact” debit interchange price controls have had on credit unions, and refuted claims made Tuesday by hundreds of merchant trade group members in a letter to House leaders on the Durbin amendment.
“Merchants are continuing to misrepresent the effects of the Durbin amendment, hoping to increase their windfall from price controls even more,” Thaler wrote.
Thaler, citing a Federal Reserve estimate, said merchants have seen $36 billion in profits as a result of this amendment, with little benefit to consumers. “Quite simply, the Durbin amendment is not doing what proponents said it would,” Thaler wrote. “It is time for its repeal.”
A provision to repeal the amendment is included in the “Financial CHOICE Act” (HR 5983) and is strongly supported by NAFCU, the trade association stated. HR 5983, introduced by House Financial Services Chairman Jeb Hensarling (R-TX), was approved by the committee in September. The House could take up the bill during the current lame-duck session.
In their letter to House leaders Tuesday, the merchants claim that repealing the Durbin amendment “would dismantle the substantial progress debit reforms have made in correcting” the card-acceptance marketplace.
NAFCU said it will continue to monitor the bill’s progress and push lawmakers to enact far-reaching regulatory relief for credit unions.