Credit union members push to delay cap on interchange fees

Nevada Federal Credit Union said Friday that 8,700 of its members signed a petition urging Senate Majority Leader Harry Reid, D-Nev., to support a bill that will delay a cap on debit card interchange fees.

Financial institutions collect interchange fees from businesses that accept debit cards for payment on goods and services.

Under a measure backed by Senate Majority Whip Richard Durbin, D-Ill., the Dodd-Frank financial reform bill was amended last year to direct the Federal Reserve Board to set a maximum fee on debit card transaction. The Fed set the cap at 12 cents for institutions with more than $10 billion in assets, well below the average 45 cents charged currently.

Nevada Federal has far less than $10 billion in assets, but its executives believe they will be forced to accept the 12-cent cap, too, because of competition from large institutions.

The cap will become law in July if Congress doesn't approve a bill postponing the effective date. Sen. Jon Tester, D-Mont., is sponsoring a bill that would delay the effective date and call for an in-depth study of the issue.

Nevada Federal CEO Brad Beal has said the credit union's revenue from interchange would drop to $2 million from $5.8 million yearly if the cap is implemented.