Big bank and merchant groups weighed in just before a deadline on Wednesday in response to the Federal Reserve Board’s proposed debit rule clarification, voicing sharply opposing views on the proposal’s support for making multiple processing networks available, particularly for online transactions.
The Fed in May proposed a clarification of its rule that merchants must have the choice of sending debit transactions over two separate networks, saying the network choices weren’t always available despite regulations requiring it. The rule was put in place as a result of the Durbin Amendment to the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. In the past few months, competing banks and merchant contingents have filed nearly 700 comments on the proposed change at the Fed.
A pack of six financial industry groups, including the American Bankers Association, the Consumer Bankers Association and the Credit Union National Association, argued in a joint 18-page response Wednesday that the Fed’s proposal is “fatally flawed” and should be withdrawn. The comments, not yet available on the Fed’s web site, were provided to PaymentsDive.