WASHINGTON – Powerful Senate leader Dick Durbin appeared to have stopped the efforts to vote to delay the interchange fee rules, leaving credit unions and banking lobbyists hunting for another way to pass their bill.
Durbin, the assistant leader of the Senate Majority who sponsored last year’s legislation to cap interchange fees, has succeeded for now in keeping the credit union-backed bill to delay the rule from a Senate vote. A bid to attach the delay to a popular bill on small business appears to have failed, meaning supporters of a delay will have to find another way to get a vote on their bill.
Still, the credit union lobby was optimistic as it built support toward the 60 Senate votes it will need to overcome a filibuster by Durbin and get a vote on the delay. “We’re confident we’ve made major strides, and are coming closer and closer to getting some much needed help on this crucial issue,” John Magill, chief lobbyist for CUNA, told Credit Union Journal over the weekend.
“Momentum continues to grow against this price-cap as folks realize it is nothing but a massive transfer of monies from consumers to the bottom line of big box retailers and their Wall Street investors,” said Dan Berger, chief lobbyist for NAFCU.
The wildcard in the Senate fight is whether Senate Majority Leader Harry Reid, a close ally of Durbin, will allow a vote on the delay, which is rapidly collecting support from both Democrats and Republicans. And if supporters are able to get a vote to delay the measure they must convince President Obama, an even closer Durbin ally, to sign it into law.
Meantime, credit union and banks have joined with MasterCard and Visa to finance a multi-million dollar national ad campaign that encompasses TV, print, radio and online pieces to educate consumers and enlist their support about this complicated issue and get them to contact their members of Congress.
One print ad, with an empty brown wallet, reads: “A new regulation will make your debit card more expensive, less convenient, or disappear altogether. Giant retailers lobbied hard for this rule because they wanted you – instead of them – to foot the bill for using your debit card.” The ad carries the tagline, “Washington is helping you clean out your wallet.”
CUNA officials said the ads are running in important congressional districts around the country as well as around Washington.
The heightened lobbying comes as the clock is rapidly approaching the implementation date for the July 21 interchange rule. The Federal Reserve told Congress it will not meet an April 21 deadline to finalize the rule but plans to meet the July 21 implementation deadline, meaning a final rule probably will be issued at least 30 days before then.
The stakes in the fight are huge and rising fast. Credit unions and banks earned an estimated $20.5 billion in debit fees paid by merchants last year – about $2.6 billion of it going to credit unions. That was up almost 20% from the previous year and is expected to increase in double digits this year. The vast majority of those funds went to fewer than 10 banks that dominate the cards market.
