ARLINGTON, Va. – Two court battles over credit cards continued in 2002, leaving it unclear as the year drew to a close how much income credit unions can expect from their credit cards and how much it will cost to offer those cards. The dispute that muddied the waters on the income side pitted retail giant Wal-Mart and other stores against VISA and MasterCard over their so-called "honor all cards" rule. The rule states that if a retailer accepts one card that carries a VISA or MasterCard brand, it must accept all of them, including the debit cards which process like credit cards. Retailers objected to this rule because they would like to be able to refuse the signature debit card, which carries a much higher rate of interchange than the debit cards that use a personal identification number. Card experts say that while credit unions are not likely to lose any money through assessments because of this case, the outcome could have an impact on the interchange rates all card-issuing institutions, including credit unions, earn from their cardholder's transactions. Further, since the case has dragged on for years, the card experts also thought it likely that the fight would end in negotiated settlement over those rates rather than a court decision. The dispute involving how much credit cards might cost credit unions saw NAFCU and CUNA join a coalition of national bank associations and large bank credit cards issuers to fight a pending law in the state of California. Under the law credit unions with cardholders in California would either have to require their customers to pay 10% of their balance each month or undertake expensive disclosures about how much their credit balances the customers. The coalition, with statements of support from NCUA and the other financial regulators, sued California and a decision is possible before press time (see story on page 3 of this issue). [email protected]