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Rep. Barney Frank said he was optimistic the Senate would soon act on a Sen. Jon Tester bill that would delay for two years a rule that would restrict interchange fees on debit cards.
April 7 -
Opponents of a rule to limit debit card interchange are making the most of an opportunity after the Fed acknowledged it would not make an April 21 deadline to finalize the regulation.
April 5 -
The banking industry saw the first tangible signs of progress Tuesday in its fight to overturn the Durbin amendment, as lawmakers officially introduced bills that would delay ...
March 15 -
In a rare show of unity, the leading bank and credit union industry groups filed a joint friend-of-the-court brief to support TCF's lawsuit looking to block implementation of the Durbin amendment.
March 11 -
Several bankers spoke directly with top Fed officials on Thursday, arguing that if they finalized their interchange rule, it would gut industry profits and hurt consumers.
March 10
The fight over the interchange amendment heated up on Wednesday when Sen. Dick Durbin, D-Ill., sent JPMorgan Chase & Co. Chief Executive Jamie Dimon an
In the letter, Durbin shot back against Dimon's recent claims that the amendment is "idiotic" and instead said banks are giving misinformation to benefit their fight against the provision.
"Clearly, debit interchange reform has displeased many in the financial services industry," Durbin wrote. "Your industry is used to getting its way with many members of Congress and with your regulators, and my amendment and the Federal Reserve's draft regulations were not written the way you wanted. But that does not mean they were written poorly or that the process that created them was flawed … The American people deserve to know the real story about the interchange fee system and the ways that banks in general — and Chase in particular — have abused that system."
The banks have aggressively been fighting a provision in Dodd-Frank sponsored by Durbin that orders the Federal Reserve Board to set rules governing interchange fees banks charge merchants. Sen. Jon Tester, D-Mont., has a bill that would delay the interchange rule for two years.
In the lengthy letter, Durbin dismissed bankers' claims that the amendment didn't have proper analysis and is price fixing.
"Of course, my amendment does not create price fixing — it constrains the price fixing that Visa and MasterCard currently perform on banks' behalf," Durbin wrote.
He also disputes that banks need the fees to pay for maintenance of debit cards and the interchange provision harms consumers. JPMorgan Chase has threatened to end free checking for debit card members and rewards programs for debit holders if the amendment isn't delayed.
"There is no need for you to threaten your customers with higher fees when you and your bank are already making money hand-over-fist," Durbin said. "And there is no need to make such threats in response to reform that simply tries to spare consumers from bearing the cost of interchange fees that are anticompetitive and unreasonably high. Interchange reform is necessary and it is long overdue."
