BOCA RATON, Fla. – While data released by the Federal Reserve indicates 99% of credit unions (those of less than $10 billion in assets) have not seen any decrease in interchange income as the result of the Durbin Amendment, one person is urging CUs to prepare for decreases to come.
“We are already seeing a 4% to 5% drop from Visa’s priority routing,” said Stan Hollen CEO of CO-OP Financial Services. “We think it will be pushed down another 10 cents, but not down to the 23 cents [big banks are seeing]. We believe the big retailers are going to pit the PIN networks against one another and drive down interchange. We sounded the alarm last summer, and maybe we were too loud, but [interchange] went down and we want credit unions to be prepared. But it will not go down so far that it can’t be overcome by new accounts and growth in debit.”
Signature debit transactions represented about 63% of transaction volume and 61% of transaction value in 2011; the remainder were PIN debit transactions.
Hollen spoke with Credit Union Journal during CO-OP’s THINK 12 Conference.
