Senate Begins Debate On Interchange Delay
WASHINGTON – Sen. Jon Tester opened debate on delaying the controversial interchange rule this morning insisting the proposed cuts in debit fees will cause unintended harm to rural banks and credit unions, even as the Senator and his allies desperately search for a bill to attach their delay measure to.
The Montana Democrat--speaking while the Senate is waiting to vote on the stop-gap budget approved last week–questioned whether the billions of dollars in lowered debit fees will be shared by merchants with consumers. “Businesses will benefit, but consumers will be no better off,” Tester asserted this morning.
The opening of Senate debate on the delay comes amid a big slowdown in congressional business, as members of the House and Senate race to pass the emergency spending bill before leaving the Capitol for their annual two-week Easter recess. The slowdown means lawmakers will have to accelerate the push to delay the debit rules when they return as the July 21 deadline for their final implementation approaches rapidly.
Making the task all the more difficult is the fact that Tester and his allies will need 60 votes in the Senate to overcome a filibuster to be launched by Illinois Democrat Richard Durbin, the chief sponsor of the interchange rule. The Montana Senator, backed by credit unions and banks, is searching for a bill very likely to pass the Senate to attach their delay measure to. Tester's bill would delay implementation for two years while its implications are studied by the Federal Reserve.
The stakes in the interchange fight are huge and growing rapidly, with banks and credit unions having earned an estimated $20.5 billion in debit fees last year, up 25% from the year before. An estimated $2.6 billion of those fees were earned by credit unions.