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The payments landscape for community banks is changing rapidly as traditional payments converge with new instant payment systems and emerging cryptocurrencies. It is critical for Community Banks to maintain awareness of developments in the payments space to assess new opportunities, mitigate risks, and ensure that their payment strategy aligns with overall business plans.
Oct. 14, 2022
The Senate version of a must-pass defense bill introduced this week excludes ICBA-opposed legislation that would create new credit card routing mandates, though the threat of the Durbin Amendment expansion remains.
Defense Bill: Despite efforts by Sens. Richard Durbin (D-Ill.) and Roger Marshall (R-Kan.) to attach their Credit Card Competition Act of 2022 (H.R. 8874/S. 4674) to the pending National Defense Authorization Act, the NDAA released this week does not include the interchange bill. Nevertheless, the lawmakers are expected to attempt to add their bill to the NDAA as an amendment when the bill is debated on the Senate floor later this year—illustrating the need for ongoing community banker outreach to Congress.
Bill Details: The Credit Card Competition Act would require banks with over $100 billion in assets to offer merchants at least two networks to process credit cards, at least one of which cannot be owned by Visa or Mastercard.
ICBA Opposition: ICBA has strongly opposed the bill and this week sent a joint letter with 44 state community banking associations calling on Congress to reject it. The groups said the bill would impose new costs on consumers and community banks, pose security risks, and end credit card rewards programs solely to bolster big-box retailers’ profits.
Grassroots Action: Community bankers can use ICBA’s Be Heard grassroots action center and share its social media call to action on the bill to rally opposition in Congress.
Consumer Campaign: Separately, the Electronic Payments Coalition—of which ICBA is a member—offers a “Hands Off My Rewards” campaign with resources encouraging consumers to weigh in against the legislation. Contact Congress.