The banking industry next week gets a crack at legislation that would require creditors to consider a bill as paid on the date a check was mailed.
Leland M. Stenehjem, president-elect of the Independent Bankers Association of America, will testify Feb. 28 at a hearing on the measure before the House Government Reform and Oversight Committee's postal service subcommittee.
Introduction of the Postmark Prompt Payment Act last year by Rep. John McHugh, R-N.Y., caused an outcry in the banking and credit card industries, which said its passage would cost them a fortune.
In letters last October to Rep. McHugh, industry groups said his measure would force banks to check postmarks on envelopes, then retroactively credit accounts and rescind late fees charged. Banks would have to buy expensive processing equipment to handle the new requirements, the groups contended.
"If this bill is enacted, it would create a tremendous expense that would ultimately end up being eaten by consumers," said Ron Ence, the IBAA's director of legislative affairs. "This is not a well thought out piece of legislation."
Mr. Stenehjem, president of First International Bank and Trust, Fargo, N.D., will testify on behalf of a coalition of trade groups that includes the American Bankers Association, the Consumer Bankers Association, and America's Community Bankers.