CUNA and NAFCU said Wednesday's defeat of an amendment by Sens. Jon Tester (D-Mont.)and Bob Corker (R-Tenn.) to delay the implementation of the Federal Reserve's rule regulating debit interchange fees would hurt credit unions and other financial institutions.
The failure to pass the measure, which received 54 votes, six short of the 60 needed under Senate rules, "is going to create a train wreck that will affect every consumer with a debit card,'' CUNA President/CEO Bill Cheney said in a statement.
"Much as they would prefer not to, credit unions will have no recourse but to make up these costs by imposing new fees or service restrictions on their members. How are consumers better off under this scenario? The plain fact is they are not,'' he added.
Cheney and NAFCU President/CEO Fred Becker said they hoped that a lawsuit by TCF Bank challenging the legality of Fed's rule, which is pending in federal court, would be decided in the bank's favor. Both groups signed two friend of the court briefs in the case.
Becker praised the "valiant fight'' by the banks and credit unions in lobbying on the issue and that it proved how hard it is to get anything passed in the Senate.
Meanwhile, National Retail Federation President/CEO Matthew Shay said the vote is a "landmark victory for American consumers that will give them the break from skyrocketing swipe fees that they have been seeking for years. With the economy still trying to gain momentum and consumers facing skyrocketing costs for necessities like food and fuel, this badly needed reform will help ensure our nation's economic recovery.''
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