Saying that that more information is needed on the unintended consequences of capping interchange fees, Rep. Shelley Moore Capito last night introduced legislation that would delay the implementation of the Fed's interchange rule by one year.
"My bipartisan bill provides for a one-year delay and allows the Federal Reserve, FDIC, OCC and NCUA to study potential unintended consequences of capping the interchange fee at 12 cents then make recommendations for changes, if necessary. Simply put, the stakes are too high for consumers to let this rule go forward without answering some of these critical questions," Capito (R-W.Va.) said in a statement.
She introduced her bill, which has 27 co-sponsors, several hours after Sen. Jon Tester (D-Mont.) introduced a similar bill in the Senate. Tester's bill calls for a two-year delay in implementing the Fed rule.
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The lead Democratic cosponsor is Rep. Debbie Wasserman Schultz (D-Fla.).
"No one wins when consumers are levied with fees or even forced out of the banking system altogether–not consumers, not banks and not merchants," added Capito, who chairs the House Financial Services Committee's Subcommittee on Financial Institutions and Consumer Credit.
According to the proposed rule, the allowable costs for interchange would be limited to no more than the issuer's allowable costs divided by the number of electronic debit transactions on which the issuer received or charged an interchange transaction fee in the calendar year. Or the issuer could receive debit interchange capped at 12 cents per transaction.
According to the provisions of the financial overhaul bill passed by Congress last year, the final rule must be approved by April 21 and in effect by July 21.
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