The Clearing House Association and eight other trade associations representing the banking and credit union industry submitted comments today urging the Federal Reserve Board to withdraw its proposed revisions to Regulation II’s debit interchange fee cap. The associations are concerned that the proposed rule would further lower an already deficient price cap on debit card interchange fees and thereby amplify the damage already done by Regulation II as promulgated in 2011, including by driving up costs to consumers for basic deposit accounts (disproportionately harming low-income and underserved consumers) and degrading the ability of banks and credit unions (including smaller, exempt issuers) to serve their communities and to invest in payment system innovation. In addition to these policy reasons, the letter raises significant questions as to the legal basis for the proposal under the statutory text of the Durbin Amendment and administrative law.

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