Even though data collected from credit unions indicates that an exemption meantto protect most credit unions from the impact of the Durbin Amendment might not be working when it comes to one kindof debit interchange, an association of retailers is claiming theamendment's small-asset exemption is shielding credit unions fromany impact on another kind of debit interchange.

The Merchant Payments Coalition, an association of retail groupsand individual retailers that is organized to lobby for lower debitand credit card interchange rates, argued in an announcement Mondaythat a recent CUNA survey of some of its members indicates thatcredit unions are being protected from seeing significantly lowerinterchange rates on debit transactions which are validated with amember's signature.

The MPC did acknowledge that the survey showed a 6% drop ininterchange revenue on debit transactions which are validated by apersonal identification number, but argued that the drop still left“banks” with higher overall interchange income.

“Even with the drop, the revenue is far more than what bankscollected only a decade ago when the fee ranged between about 5 and10 cents per transaction,” the MPC said.

Passed as part of the Dodd-Frank financial reform act, theso-called Durbin Amendment, named for chief sponsor Sen. RichardDurbin (D-Ill.), capped interchange for debit card issuers withmore than $10 billion in assets, but was supposed to exempt debitcard issuers of fewer than $10 billion. Only four credit unionshave assets of more than $10 billion and thus have their debitinterchange capped by the rule, though several others seem likelyto pass that threshold this year.

To help facilitate the exemption, the large card brands and cardprocessors widely implemented a two-tier interchange schedule whichset one payment rate for institutions which are covered by the capand another for institutions, largely community banks and mostcredit unions, which are not. “Credit unions have confirmed whatthe FTC, GAO and Federal Reserve have found: the small bankexemption from debit reform has worked. This news demonstrates thatdebit reform has been good for consumers, Main Street businessesand smaller banks as well,” said Scott DeFife, executive vicepresident of policy and government affairs for the NationalRestaurant Association and a member of the MPC.

The MPC alleged institutions which are under the Durbin cap havepromulgated a myth that the cap damages credit unions and communitybanks.