CUNA argued in the brief that large and small financial institutions are negatively impacted by the Federal Reserve’s interchange fee cap because the savings and benefits promised by merchants who pushed for the cap have yet to materialize, ATM Marketplace reports.
CUNA also said that the fees are so low that card issues cannot recoup costs or see a reasonable return on their investments. The organization says it plans to join a group of trade associations representing financial institutions.
Last October, a Dodd-Frank-mandated cap on interchange fees – the amount a bank can charge a merchant to process a debit transaction – was placed in a final ruling at 21 cents, less than half of the original but far higher than merchants would like.
Though most credit unions are exempt from the fee cap, CUNA said that an exemption is not much of a benefit because merchants have the ability to forego exempt debit cards in favor of non-exempt cards from larger, less expensive issuers, according to ATM Marketplace.
Other organizations filing in the brief include the American Bankers Association, the Clearing House Association, the Clearing House Payments Company, Consumer Bankers Association, the Financial Services Roundtable, the Independent Community Bankers of America Midsize Bank Coalition of America, the National Association of Federal Credit Unions and the National Bankers Association.