By William J. Mellin, President/CEO
The New York Credit Union Association has long opposed legislation that allows merchants to route payments through an unaffiliated network.
Last week, the latest efforts by Sen. Roger Marshall included adding interchange language to the National Defense Authorization Act (NDAA). The goal of the Association and CUNA is to get as many objections to the interchange amendment and commitments to oppose its inclusion in the NDAA as possible.
Members of the U.S. Senate introduced the Credit Card Competition Act of 2023 in June. The current system protects cards and competition for consumers and businesses. The interchange fee is a portion of the merchant discount fee that the retailer’s financial institution pays to the cardholder’s credit union for the service of utilizing the card system and the benefits provided, including the avoidance of processing fees and ensuring guaranteed payments.
Interchange fees help credit unions protect consumer data and offer additional services like fraud monitoring needed as consumer data and privacy is consistently under attack by cyber criminals.
The Association cannot support any legislation that hands control of the nation’s credit card system to merchants that do not have our members privacy and interest in mind, only internal profit.
Further, this bill shouldn’t be anywhere close to legislation funding the military, and these efforts are simply a way to ram this damaging bill forward without holding a hearing.