'Economist' Interchange Article Demonstrates Why CUs Have the Most to Lose

Card payment terminal

The California and Nevada Credit Union Leagues and the Credit Union National Association (CUNA) have been battling legislation to regulate credit card interchange fees. Much has been written — and will continue to be — regarding the issue.

This includes the Aug. 17 article from The Economist covering the interchange fee topic. It outlines a unique perspective on the debate.

It also shows the extent to which retailers are not only willing to fight, but to also find solutions circumventing interchange. Credit unions have the most to lose in this fight, which makes it critical that every credit union engage with our Members of Congress.

The Leagues have an open Connect For The Cause action alert as we continue to educate Congress about this issue daily. However, it will take a new way of telling our story to defeat this issue in the long run. This news piece from The Economist demonstrates why.

Please have your credit union staff and supporters take IMMEDIATE action on this issue by sending a message to Members of Congress telling them to leave the credit card interchange system alone!

Interchange Bill Details
Two U.S. senators recently introduced credit card interchange legislation that would impact credit union members’ ability to use their cards. The legislation would shift interchange cost from big-box retailers to consumers and be a major power grab for the retail industry.

The bill was introduced by Sens. Dick Durbin (D-IL) and Roger Marshall (R-KS). It would allow merchants to route payments through an unaffiliated network, bypassing established secure payment networks at the expense of consumers. Routing mandates on credit cards would lead to less secure, less innovative, and higher-risk transactions.

Consumers, small businesses, and small community financial institutions will lose-out the most if this legislation sees success. Consumers across the country rely on credit cards to make life happen, from paying for groceries and school supplies to covering emergency car repairs and medical expenses. Accepted nearly everywhere, credit cards offer robust security, fraud protection, and access to credit that may not otherwise be available.

Those card conveniences have a cost. If retailers are successful, they will shift these costs to pad their bottom lines.

Credit union advocates can help shift the tide on this issue, which is why the Leagues need their support today.

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