As the Federal Reserve announces its final ruling regarding new debit interchange fee regulations, let’s take a look back at how we got to where we are today. From the 11th hour insertion of the amendment introduced by Sen. Dick Durbin (D-IL) into the Dodd-Frank financial overhaul bill to the Senate voting down last-minute legislation to delay implementation of the Fed’s proposed swipe fee caps, all sides should certainly be able to agree on one principle: this pivotal payments debate has been nothing short of riveting. (For additional information on any news item below, click on the hyperlinked date. )
May 4, 2010: Durbin introduces three separate amendments on debit interchange fees to the Senate’s version of financial reform. (Source: Electronic Payments Coalition)
May 10, 2010: Durbin introduces a single combined amendment that directs the Fed to set debit interchange rates and allows merchants to set a minimum payment limit on debit cards. (Source: Electronic Payments Coalition)
May 13, 2010: Senate approves Durbin’s amendment by a vote of 64-33. Included is the exemption from the impending regulations for banks and credit unions with assets under $10 billion. (Source: durbin.senate.gov)
May 14, 2010: Durbin sends letter to the Independent Community Bankers of America and the Credit Union National Association after two associations announces opposition to amendment. (Source: durbin.senate.gov)
June 16, 2010: A letter signed by 71 Democrats and 60 Republicans stresses that an amendment regulating credit and debit card interchange fees would harm every consumer that uses these cards to pay for everyday essentials and large purchases alike as well as have a negative impact on small community banks and credit unions. (Source: wassermanschultz.house.gov)
June 18, 2010: The National Retail Federation launches a radio campaign urging the House and Senate to keep an amendment seeking reasonable swipe fees for debit card transactions in financial services reform legislation expected to be finalized next week. (Source: PYMNTS.com)
Jun 22, 2010: Assistant Senate Majority Leader Dick Durbin (D-IL) announces that an agreement has been reached with key conferees on the Wall Street reform bill regarding his amendment regulating interchange fees. (Source: PYMNTS.com)
July 21, 2010: President Obama signs the Dodd-Frank Wall Street Reform and Consumer Protection Act into law (P.L.111-203), ushering in sweeping reforms of the banking industry including reforms of interchange fees. (Source: PYMNTS.com)
July 21, 2010: The National Retail Federation welcomes signing of financial reform legislation and urges regulators to follow Congress’ intent of achieving major reductions in the fees.
September 22, 2010: PYMNTS.com gathers top payments thought leaders for webinar to debate and discuss Durbin.
October 10, 2010: TCF National Bank (“TCF”), a subsidiary of TCF Financial Corporation, announces it is filing a lawsuit challenging the constitutionality of the Durbin Amendment (“the Amendment”). (Source: PYMNTS.com)
December 16, 2010: The Federal Reserve Board staff proposes two alternatives to debit interchange fee regulation. Both would set a maximum of 12 cents per transaction for debit cards with no apparent distinction between signature and PIN. (Source: PYMNTS.com)
December 17, 2010: House Financial Services Chairman Rep. Barney Frank (D-MA), one of the chief authors of the financial reform bill, tells CNBC that card companies would have difficulty covering the total cost of debit transactions under the Federal Reserve’s preliminary plan for interchange fee regulation. (Source: CNBC)
January 17, 2010: JPMorgan CEO Jamie Dimon says: “We might just charge for checking. You might charge for debit. You might just have higher deposit balances… The general banking customer base may be pushed out of the banking system.” (Source: philly.com)
February 17, 2011: The House Financial Services Committee hears testimony on the Federal Reserve’s proposal for debit card interchange fees. (Source: PYMNTS.com)
February 22, 2011: An unprecedented coalition of every major U.S. bank and credit union trade association urges the Federal Reserve in a letter to fundamentally revise its proposed rule on debit card interchange fees. (Source: PYMNTS.com)
February 23, 2011: The Merchant Payments Coalition (MPC) during a meeting with the Federal Reserve Board asserts that the Durbin Amendment of the Dodd-Frank financial overhaul bill addresses market failures in the debit industry. (Source: PYMNTS.com)
March 15, 2011: Senators Jon Tester (D-MT), Bob Corker (R-TN), Jon Kyl (R-AZ), Ben Nelson (D-NE), Tom Carper (D-DE), Pat Roberts (R-KS), Chris Coons (D-DE), Mike Lee (R-UT), and Pat Toomey (R-PA) introduce legislation to protect consumers, small businesses and rural and small community banks and credit unions from a proposed rule regarding transaction fees on debit cards. (Source: tester.senate.gov)
March 30, 2011: Federal Reserve Board Chairman Bernanke tells Congress that the Fed won’t be able to meet the April 21st deadline set by the Dodd-Frank Act for regulating the debit card business. (Source: PYMNTS.com)
March 31, 2011: Grocers from across the U.S. meet in Washington, DC today to give lawmakers their “two cents” on why Congress should not delay implementing debit card swipe fee reform .
April 5, 2011: Federal court denies injunction based on TCF’s facial constitutional challenges to the Durbin Amendment. (Source: PYMNTS.com)
April 5, 2011: Frank annouces that he would support legislation to delay implementation of the Federal Reserve’s debit interchange limits. (Source: PYMNTS.com)
April 14, 2011: Nearly 500 restaurateurs from 44 states arrive on Capitol Hill, calling on their congressional members to fight the tactics of big banks and debit-card companies seeking to halt much-needed reforms to a broken market for debit-card swipe fees. (Source: PYMNTS.com)
May 12, 2011: Bernanke tells lawmakers that there is “reason to be concerned” that the debit interchange exemption for smaller financial instructions wouldn’t be effective and may even result in bank failures. (Source: PYMNTS.com)
May 13, 2011: The Durbin amendment will impact mobile carrier’s chances to effectively compete against Visa, MasterCard and other major issuer networks, says John Stankey, AT&T’s head of business solutions. (Source: PYMNTS.com)
May 23, 2011: The National Coalition of Associations of 7-Eleven Franchisees urges the owners of its 4,900 franchise-owned stores, their nearly 40,000 employees, and their customers to contact their elected representatives to show their support of the Fed’s current rulemaking process in swipe fee reform. (Source: NCASEF)
June 8, 2011: The Senate vote on the Tester Bill to delay the Federal Reserve’s proposed caps for debit card interchange fees fails to get the 60 votes needed for passage, meaning the new limits will take effect on July 21 as scheduled. (Source: PYMNTS.com)
June 8, 2011: National Retail Federation calls vote on Tester Bill a “landmark victory for American consumers.” (Source: PYMNTS.com)
June 21, 2011: The Federal Reserve schedules a meeting for June 29 to discuss plans regarding new debit card interchange fee regulation, according to a meeting notice on their website. (Source: PYMNTS.com)
June 29, 2011: The Federal Reserve Board issues the final version of Regulation II, which sets new rules for debit card transactions. The Final Rule sets a cap of 21 cents on transactions that fall within its scope (plus 5 basis points on the transaction value) and requires issuers to place two unaffiliated marks, on every debit card.
June 30, 2011: TCF requests dismissal of lawsuit challenging Durbin Amendment
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