U.S. Public Interest Research Group presents the argument that merchants will pass their savings on to the consumer (
But just for the sake of argument, let's suppose they are correct. Does this group really think that banks and credit unions are going to operate at a loss? ABSOLUTELY NOT!!! Higher fees and other charges would most certainly wipe out any savings consumers might gain from a merchant price reduction. So, if this group's theory is INCORRECT, then the merchants will experience a huge increase in earnings, and many financial institutions will still be forced to raise fees and interest rates, and do whatever else they must do to survive.
Allowing the debit interchange rule to stand will definitely cost the consumer at the bank, and probably won't save them anything at the merchant. Either way, this group's lobbying effort is not going to help the consumer. The best the consumer can hope for in this issue is to break even.
Ricky Browning, SVP & CFO
Singing River FCU, Moss Point, Miss.
