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Vote Alert

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NTU urges all Senators to vote “YES” on Senator Jon Tester’s (D-MT) amendment to S. 782, the Economic Development Revitalization Act of 2011.

June 8, 2011

This amendment would delay implementation of price controls on debit card transactions to afford time for a thorough study of their potential impacts.

Under Section 1075 of the Wall Street Reform and Consumer Protection Act, the Federal Reserve has proposed new regulations that would cap interchange fees at 12 cents, a level more than 70 percent below their 2009 average. By substituting arbitrary price controls for market-determined interchange costs, Section 1075 may lead to unintended consequences such as fewer and less diverse debit card offerings along with financial hardship for small banks.

In response to the proposed rules, banks have already begun to eliminate services like free checking and cash-back bonuses, or have added new fees to services. Even without these added burdens, there is little chance that consumers would see any real cost savings from the interchange cap as resources are simply shifted from the issuer of the debit card to merchants.

For the foregoing reasons, we urge Congress to delay the impact of Section 1075 until the potential effects on overhead costs and taxpayers are fully examined. Roll call votes on Sen. Tester’s amendment will be significantly weighted in our annual Rating of Congress and a “YES” vote will be considered the pro-taxpayer position.

If you have any questions, please contact
NTU Federal Government Affairs Manager Brandon Greife at (703) 683-5700