WASHINGTON – Responding to progress credit unions and banks have made in Congress to delay or derail new interchange caps that are included in the Durbin Amendment to the Dodd-Frank Act, the National Retail Federation is rolling out a major, nationwide, 60-day lobbying, grassroots and media campaign aimed at ensuring that the law goes into effect as scheduled.
The NRF said the legislation will save retailers and their customers more than $1 billion a month by lowering “swipe” fees banks charge to process debit card transactions if it takes effect in late July as scheduled.
Credit unions and banks have argued that the Durbin Amendment lowers those fees to the point checking accounts and debit cards will be all but guaranteed to be unprofitable, and that new fees will have to be added to compensate.
The NRF said its campaign will include intensive grassroots mobilization, a June fly-in to Washington to meet with Congress, an “aggressive” media relations campaign, nationwide print and radio advertising, social media and a website at: www.nrf.com/swipefees.
“Now that Congress has done something about these fees, retailers are standing by to pass the savings along to their customers through lower prices and higher value,” said NRF President and CEO Matthew Shay.
Credit unions and their trade groups, however, say the issue isn’t about retailers returning savings to customers.
“It’s clear that the merchants are feeling the heat on this issue, and are fighting back,” said CUNA CEO Bill Cheney. “That should be no surprise; since March 15 credit unions have generated at least 325,000 direct contacts with members of Congress…Credit unions acknowledge that there should be sensible reform of Interchange fees – but what is in the law now is not sensible at all. In fact, if the law were in place today, the impact from recent data breaches would be catastrophic for small issuers such as credit unions.”
Earlier this week, in separate comments to the CUNA CFO Council in San Diego, Cheney said credit unions are “extremely close” to convincing the Senate to halt implementation of an interchange cap of 12 cents per transaction.
The effort to halt implementation has 57 votes, just three shy of the 60 needed, he said. Shortly before taking the stage Cheney was told Sen. Harry Reid (D-Nev.) will vote with Sen. Richard Durbin. “This is not the end of the world but it is disappointing,” he said. The next targets are Sens. Dianne Feinstein (D-Calif.), Mike Crapo (R-Idaho) and Tim Johnson (D-S.D.). “We are making progress, but we do need your help,” Cheney told the audience. “I know this has been around for some time and there is a fatigue factor, but if you've sent 10 e-mails to your senator, we need you to do it again. If we don't get three more votes, we might as well have zero.”