Some credit unions which are supposed to be sheltered from the impact the Durbin Amendment's cap on debit interchange saw their interchange drop by collectively over $1 million in the third quarter of 2012, according to data collected by CUNA.
Although the association initially reported that only between 120 and 130 credit unions participated, in fact 230 credit unions responded to an invitation from CUNA to share their debit interchange data and of those CUNA used data from 155, according to CUNA Chief Economist Bill Hampel.
“Some were not able to break out signature debit interchange from PIN debit interchange,” he said, explaining why some who initially responded were eventually not used.
“Some had changed processors during that period and were not able to collect the necessary data. If they did not have the data we needed, we didn't use their data,” he added.
CUNA looked at the data across four time periods: the nine months from December 2010 to September 2011 provided a baseline for comparison. Six months from September 2011 to March 2012 provided data from the regulation's initial implementation and the association collected data from March to June 2012 and from June to September 2012 which represented debit interchange under the regulation's full implementation.
Regulations implementing the Durbin Amendment's cap went into effect on Oct. 1, 2011. Regulations implementing processing changes went to effect somewhat later.
The data from the 155 credit unions showed that while their debit interchange income increased across the quarter ending in June 2012, it decreased by 1.4% in the quarter ending in September 2012, translating into a loss of $1.38 million for the 155 credit unions in the quarter ending in September 2012.
This was despite seeing the overall number of debit cards issued by the 155 credit unions increase by almost 165,000 over the same quarter.
CUNA is continuing to collect debit interchange data to determine if this decline represented a one-time adjustment to the new regulation or is the first sign of an ongoing trend.