ICBA, others urge Fed to withdraw debit interchange proposal 

ICBA and other groups urged the Federal Reserve to withdraw its 2023 debit interchange proposal until there is legal certainty in several court cases.  

Details: In a letter to the Fed, ICBA and the other groups said: 

• The Corner Post and Linney’s Pizza cases have conflicting rulings on the original Regulation II, making any final rulemaking on the 2023 proposal highly questionable. 

• Leaving the debit card market in limbo creates uncertainty for issuers, networks, and merchants.  

• The Fed should release the 2023 debit card survey data, which was collected more than 19 months ago. 

Fed Proposal Background: The Fed proposal would lower the maximum interchange fee that covered debit card issuers may receive for debit card transactions under Reg II, which would lead to a third of covered issuers not covering debit costs. 

ICBA Advocacy: ICBA has repeatedly called on the Fed to withdraw the Reg II proposal, including in its May 2024 comment letter, comments to the agencies earlier this year under the Economic Growth and Regulatory Paperwork Reduction Act review, and in a May letter to the Office of Management and Budget.