Senate Rejects Latest Bid On Interchange
WASHINGTON – The Senate Appropriations Committee last night agreed to scrap a proposal that would ensure the lowest credit card interchange rate for government transactions, the latest assault on the lucrative source of revenue for credit unions and banks.
Instead, the Senate panel agreed to a credit union-backed proposal that would study the interchange structure on government transactions.
The original amendment, proposed by Sen. Richard Durbin, the Illinois Democrat who has been crusading for lower interchange fees, would have required that federal government entities pay the lowest rate, currently reserved for supermarket transactions.
The bid comes just weeks after Sen. Durbin succeeded in getting an amendment into the bank reform bill that will set up the Federal Reserve as chief regulator on debit card interchange.