Congress shouldn't pass a measure further regulating interchange fees or speed up the implementation of a bill overhauling credit card rules, representatives of CUNA and NAFCU told lawmakers today.
Local Government Federal Credit Union Executive Vice President Mark Caverly, speaking on behalf of CUNA, framed the issue as one of survival for smaller financial institutions and better value for consumers during testimony before the House Financial Services Committee.
"If issuing institutions terminated their card programs due to a decrease in interchange, consumers would have fewer choices in providers. Those of us who work in smaller financial institutions believe that more choices lead to lower costs for consumers," he said. "Card programs allow credit unions to compete with the largest of financial institutions."
At issue is a bill sponsored by Reps. Peter Welch (D-Vt.) and Bill Shuster (R-Pa.), that would require credit card companies to disclose interchange rates to consumers and businesses and give the Federal Trade Commission the power to review these rates and prohibit practices deemed anti-consumer or anti-competitive.
NAFCU Director of Regulatory Compliance Anthony Demangone expressed opposition to a bill by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Joint Economic Committee Chairman Carolyn Maloney (D-N.Y.) that would have most of the provisions of the credit card overhaul bill passed in May take effect in December, rather than as scheduled next February.
He added that "many credit unions don't have the resources to fully implement the letter of the changes in such a short time period."
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