Interchange: Merchants due to file Wednesday
Merchants in favor of federal Judge Richard Leon’s decision in July to overturn the Federal Reserve’s rule limiting the fees financial institutions can charge for processing debit card transactions have until Wednesday to file their response to the Fed’s appeal brief.
On Oct. 21, when the Fed submitted its latest brief to Judge Leon, NAFCU and other amici also filed a brief in favor of overturning the court’s ruling invalidating the Fed’s current debit interchange rule. NAFCU supports raising the current cap on debit interchange fees in order to preserve credit unions’ ability to receive income on card services.
The Fed’s final rule will stay in place pending the appeal. The rule limits debit interchange fees to 21 cents per transaction plus 1 cent for fraud costs. This cap applies to debit card issuers having more than $10 billion in assets. The rule also sets prohibitions against network exclusivity that apply to all card issuers. Leon said the cap was too high and that the nonexclusivity provisions are inadequate.
After the merchants’ brief this week, the Fed has a Dec. 4 deadline to respond.continue reading »