Two years ago at the World Credit Union Conference, Australian credit unions shared stories about the impact of an interchange cap.
Australian credit union executives reported that the cap led to reduced card usage and forced credit unions to begin charging fees for other services card interchange previously supported.
The only group, executives said, that benefited from the cap were Australian retailers who failed to pass the savings on to consumers.
Phylip Doughty, CEO of the largest credit union in the state of Victoria MECU Ltd. at the time said that retailers offered a lower price for using cash if consumers asked for it but failed to remind them that a lower price was available. MECU had already put a fee schedule in place for use of debit cards at points of sale and ATMs and was moving forward, at the time, to put fees in place for credit cards.
Another credit union executive, Glenn Sargeant, executive manager for finance at Teachers Credit Union in Silverwater, New South Wales, said that his credit union started charging fees for cards, ATMs and rewards programs.