In a First, Interchange Gained Federal Regulation – Card Steering Questions Pop Up Soon After

From: Credit Union Times

This year saw a regulation capping the interchange card issuers were able to earn on a debit card transaction come into effect for the first time in history.

Passed and signed into law in 2010, the legislation mandating the cap, colloquially known for its chief sponsor, Sen. Richard Durbin (D-Ill.), had been included relatively late in the process of drafting the Dodd-Frank package of financial industry regulatory reforms. Controversial from the start, the amendment mandated that debit card issuers of more than $10 million in assets would have to live under the cap while those under $10 million, including all but three credit unions, would be exempt from the cap.


Dick Durbin’s Hypocritical Quest for “Honest Information’ on Bank Fees

Editor’s Note:  Posting of the following article does not indicate that the Interchange Fees Forum endorses the views presented. The article is being presented in the interest on promoting a vigorous debate of regulatory issues affecting the electronic payments industry.

From: CEI/

by John Berlau

Senate Majority Whip Dick Durbin (D-Ill.) wants banks and credit unions to know that he’s all about transparency and “honesty” in consumer fees.

In his recent letter hectoring the Illinois Bankers Association and the Illinois Credit Union League, Durbin proclaimed that  ”consumers in Illinois and across America have made clear their desire for honest information about banking fees.” He urged the banks to “be transparent about fees” by adopting a checking account disclosure form he favors.


New Research Shows Retailers Pocketing Savings from Durbin Amendment

Editor’s Note:  The study, Where’s the Debit Discount? Durbin Price Controls Fail to Ring Up Savings for Consumers, is attached below.  The InfoGraphic summary of the study may be found here.

From: Electronic Payments Coalition

Consumers Seeing Red, Not Green, at the Register during Holiday Shopping Season

WASHINGTON, Dec. 8, 2011 /PRNewswire/ — Consumers are getting a lump of coal this year from giant retailers. According to new field research released today, at least 76 percent of retailers included in the research have not passed promised savings to consumers, despite already receiving $825 million in windfall profits from the Durbin amendment. Congress justified the Durbin amendment, which established price controls on the cost retailers pay to accept debit cards, in part because of proclamations by retailers that consumers would benefit in the form of lower prices.


The Critical Role of Civil Servants

Historically, federal civil servants played a critical role in developing and implementing federal policy. The attached article in the Administrative Law Review, published by the American Bar Association in conjunction  with the Washington College of Law of the American University, sets forth in Section D on page 54  the critical role career federal employees had in the establishment of centralized regulatory review in the White House Office of Management and Budget.


Debit Fee Cut Killing Bank Profits: Analysts

From: Forbes

Legislation known as the Durbin Amendment that limits fees banks can charge retailers on debit card transactions is proving more damaging than previously thought, according to analysts.

Rochdale Securities analyst Richard Bove cut earnings estimates for both Bank of America (BAC) and Wells Fargo (WFC) on Tuesday, citing revenues lost to Durbin in both instances, among other issues.