Editorial boards, news outlets and experts agree: Interchange legislation is bad for consumers and bad for business.

"The Credit Union National Association has said a provision in the U.S. Senate-approved Financial Reform Package could cost a credit union as much as $15 to $30 per debit card issued. The new law could mean passing those costs on to the 2.65 million credit union members in Ohio, while other credit unions may be forced to end their debit card program."

Dayton Business Journal
("Ohio credit unions oppose debit card legislation," June 2, 1010)

"Treasurers from at least eight states are considering sending a letter to lawmakers this week over concerns that proposed limits on the fees card issuers charge for processing purchases could endanger state programs that use prepaid cards to dispense crucial benefits such as unemployment insurance."

The Washington Post
("States join the fight against proposed limits to credit card fees," June 1, 2010)

"Congress is mulling changes to the fees and restrictions that banks and credit card companies can place on merchants that accept credit and debit cards, but the changes may not have as positive an effect on consumers as retailers have suggested…For a lesson in what might happen, [Bill Hardekopf, CEO of LowCards.com] points to Australia, which slashed interchange fees in 2003. Because they lost the fee income, he says, banks reduced credit card reward programs, increased annual fees and required customers to pay credit card bills sooner."

USA Today
(“Changes in bank, debit card fees may have limited impact,” May 25, 2010)

"Somehow I doubt that merchants would throw a parade and immediately cut all prices by half a percentage point on every item on the day this bill goes into effect, if it comes to pass. . . . It will be hard for merchants to point to the vague idea of less-steep increases and satisfy angry customers who may suddenly be paying $10 a month for a checking account or earning half as many debit card rewards because their bank can’t afford to be as generous."

The New York Times
(“How the Finance Bill Affects Consumers,” May 21, 2010)

"The bad news for consumers: Banks are expected to respond to the regulatory shake-up with more fees on basic services such as checking accounts. Merchants will be permitted to set minimum-purchase amounts for credit-card transactions. . . . It isn't clear, though, if merchants will pass along their savings on so-called interchange fees to customers."

The Wall Street Journal
(“A Mixed Bag in Store for Consumers,” May 21, 2010)

"Consumers will see new fees or greater restrictions on their use of debit cards - reminiscent of times past when banks imposed a limit on the number of free debit transactions a consumer was permitted in a given month, after which consumers had to pay a fee."

Digital Transactions
("Potential Effects of Durbin Amendment Roil the Debit Card Industry," June 2, 2010)

"The money banks earn from issuing credit and debit cards improves their capital base and makes them more able to lend. If banks can't manage their risk with interchange and other fees, they will issue few credit cards to riskier borrowers."

The Wall Street Journal
("The Reduced Credit Act," May 20, 2010)

"The CARD Act reminded us that regulations have consequences. … If this passes, consumers may not be happy with what the regulations mean for them."

Forbes
("Senate Amendments Could Be Major Setbacks for Credit Card Issuers," May 19, 2010)

"Lawmakers in Washington have recently taken aim at the credit card industry, and whether you agree with the spirit of the law, we believe the outcome will be less credit available to consumers."

Forbes
("Credit Card Bill: Consumers Still Get It In The End," May 18, 2010)

"Interest-rate caps and interchange fees will more likely drive consumer credit out of the market and many community banks out of business."

The Wall Street Journal
("The Small Business Credit Crunch," May 17, 2010)

"We believe there would be significant unintended consequences from these proposals if enacted, and believe current-interchange rates support card issuance by both large and small banks and credit unions."

Barron's
("Fed Will Likely Go Soft on Interchange," May 17, 2010)

"Financial reform should not be about backroom deals for special interests and hidden taxes on consumers. Nor should it be about “fixing” parts of the system — like interchange — that actually serve consumer interests."

New York Times
("Credit Card Fees," May, 5, 2010)

“Any change to the rules regarding interchange fees would “provide an advantage to large financial institutions at the expense of credit unions and other small financial services providers,” Chartway Federal Credit Union Vice President of Operations John Blum told the House Judiciary Committee today.”

Credit Union Times
("Chartway’s Blum Urges No Change in Interchange Rules ," April, 28, 2010)

“A number of big and small companies - including eBay’s PayPal unit, Intuit, VeriFone and Square — are creating innovative ways for individuals to avoid cash and checks and settle all debts, public and private, using their cellphones.”

The New York Times
("Cellphone Payments Offer Alternative to Cash," April, 28, 2010)

“Interchange fees should be part of the merchants' cost of doing business, much like postage and advertising. The fees are certainly less costly to them than the old method of handling paper checks.”

Birmingham News
(“YOUR VIEWS: Bank interchange fees cover costs of cards,” February 3, 2010)

"Using a credit, debit card or other form of electronic payment is far superior to sending a check. Electronic payments are immediate, easier to distribute, and secure. The bottom line is that speed is crucial in a crisis, and a donation with one of the major cards is the fastest way to help."

The Huffington Post
(“Giving to Haiti and to the Future,“ January 26, 2009)

“If enacted, these price caps would have a devastating impact on the nearly 100 credit unions in Tennessee. These ‘interchange fees’ provide indispensable revenue to credit unions, which use them to offer a broad array of financial services at the local level.”

The Tennessean
(“Free market economic systems benefit consumers," January 11, 2010)

“James Boyd, president of the Abilene Teachers Federal Credit Union, said the credit union uses interchange fees to cover the expense of fraudulent purchases made with lost or stolen cards. And, without those fees, Boyd said his credit union would be forced to reassess whether or not it could afford to offer debit and credit cards to consumers.”

Abilene Reporter News
(“Credit or debit makes a difference to retailers,” January 6, 2010)

“[P]rice controls on interchange fees would also result in consumers paying more and getting less.”

Wall Street Journal
(“Will Congress Take Another Swipe at Credit Cards?” January 5, 2009)

“For retailers, paying a 1.5 percent interchange fee to avoid losing 10 percent is a good trade, especially when studies show that accepting credit cards boosts a store's sales by at least 20 percent. But large retailers see an opportunity for a big profit boost, hence the lobbying blitz.”

Wisconsin State Journal
(“Paul Skidmore: Credit card fees hurt retailers, customers,” December 27, 2009)

“If merchants get their way and persuade Congress to regulate their share, consumers will pay more. That happened in Australia, where the government regulated these fees.”

Boston Globe
(“Something fishy,” December 23, 2009)

“[A]rtificially lowering interchange fees could force credit unions like mine to either raise fees for our members, or possibly stop offering credit cards. All we ask is for merchants to pay their fair share in a system that brings them clear benefits.”

Boston Globe
(“Credit union ache,” December 23, 2009)

“By letting businesses pay each other with card accounts, Bank of New York Mellon Corp. says it can profitably ease the inherent tension between suppliers, which want to be paid as early as possible, and buyers, which often want to hold onto the funds until the last minute.”

American Banker
(“Fast B-to-B Payments May Spur Demand, Despite Fee,” December 21, 2009)

"But few ironies are as neck-snapping as the current effort by the nation's largest retailers - multinational corporations such as Wal-Mart, McDonald's and 7-Eleven - to win for themselves a giant congressional bailout that, yes, will be footed by consumers."

Journal Sentinel
(“Consumers lose if retailers are bailed out,” December 10, 2009)

“Contrary to retailers’ claims, a body of economic and empirical evidence indicates that government intervention in the setting of interchange fees would hurt consumers, undermine efficiency in commercial transactions, and stunt innovation in electronic payment networks.”

Competitive Enterprise Institute
(“Payment Card Networks Under Assault,” December 3, 2009)

“International evidence suggests that shoppers do not necessarily benefit from caps on fees. Indeed, they may suffer as banks’ interest rates rise to compensate. Interchange should be a long way down regulatory to-do lists.”

Financial Times
(“Interchange Fees,” November 29, 2009)

“Australia’s experience is being pointed to as an example of just how tricky [regulating interchange fees] can be: for one thing, if regulators limit one fee or rate, banks are likely to find another way to keep revenue flowing.

New York Times
(“U.S. Looks to Australia on Credit Card Fees,” November 26, 2009)

“Artificially lowering this merchant cost of business would force us to make an impossible decision either to raise costs for our members or to stop offering cards altogether, leaving consumers with fewer choices and higher prices.”

Deseret First News
(“Consumers Could Be Hurt,” Letter to the Editor, November 26, 2009)

“U.S. consumers may not save money and could wind up paying more for purchases if lawmakers force credit-card companies to cut processing fees charged to merchants, a government watchdog said.”

Bloomberg News
(“Lower Card ‘Swipe’ Fees May Hurt Consumers, GAO Says,” November 19, 2009)

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