To prepare for possible action in Congress on delaying the Federal Reserve’s interchange rule, credit unions redoubled their grassroots efforts on the issue during the recent recess.
From town halls to media interviews to hosting meetings, credit unions emphasized the benefits to consumers of not having a price cap on the interchange fees.
"All the lawmakers from Missouri had town hall meetings and we had credit union folks in them asking questions and stating our concerns," said Amy McLard, vice president of federal legislative affairs for the Missouri Credit Union Association.
She said that while all of the lawmakers had a general familiarity with the issue, some of the fine points had to be explained to those who weren’t involved financial services-related policymaking.
McLard said that Rep. Jo Ann Emerson (R-Mo.), visited Poplar Bluff Credit Union, and while she didn’t state a position on the interchange delay, she was receptive to the points raised.
The Senate could take up legislation, sponsored by Sens. Jon Tester (D-Mont.) and Bob Corker (R-Tenn.) to delay the implementation of the Federal Reserve’s rule by two years as early as this week. The bill has 15 co-sponsors. A companion House bill sponsored by Rep. Shelley Moore Capito (R-W.Va.) has 94 co-sponsors.
Entrust Federal Credit Union President/CEO Susan Adams, Virginia Credit Union President/CEO Jane Watkins and three community bank executives met with the editorial page editor of the The Richmond Times-Dispatch to discuss the issue.
"He was very well-informed and asked good questions, but we didn’t come away with a sense of what position they are going to take," Adams said. "He had no idea about the fraud issue and he seemed interested in learning that the expenses in that area are taken on by the issuer, not by the card companies."
She added that her Richmond, Va.-based credit union, which has assets of $67 million, has addressed the issue on its website and they’ve encouraged members to write letters to their elected officials.
"A few people have inquired about writing letters but we expect we will get more interest when we do a blast email soon," she said.
Geri LaChance, North Island CU executive vice president/chief operating officer, said they have received positive responses from the House members in the San Diego area on the issue. Almost all of them have either signed on as co-sponsors of the measure to delay implementation of the Fed rule or said they plan to.
She said the biggest challenge has been to persuade lawmakers that the position taken by credit unions will help consumers, since those on the other side of the issue have framed their position as pro- consumer as well.
"It’s been a difficult issue to communicate because those who support the Durbin amendment say it will help the consumer. We have had to show that while that may be their intention that’s not the case because it would mean an end to things such as free checking and other services," said LaChance, whose credit union has assets of $1.1 billion.
Emery Federal Credit Union President/CEO Joseph Lind made his case on the interchange issue and also put in a major plug for his credit union during a radio appearance.
"It’s going to hurt the very institutions that didn’t cause the problem. We already have thin margins," he explained during an interview with the Cincinnati radio station WLW.
But later on in the interview, as the discussion proceeded to the overall economy, Lind made a pitch for his $136 million credit union’s services. "If you’re a business who has been ignored by your bank, come see us. No loan is too big or too small for us," said Lind.