History of the Issue

Price Control Regulation on Debit Interchange: TIMELINE

May 13, 2010

With virtually no review or consideration–and no hearings or debate in any committee–the  Durbin amendment passes on the Senate floor as an amendment to S. 3217 (which would ultimately become the Dodd-Frank Wall Street Reform and Consumer Protection Act), three days after it was introduced.  In order to secure the votes he needs from Senators who were concerned about hurting community banks and credit unions, Senator Durbin hand-writes edits in the margins that seek to “carve out” protections for smaller financial institutions.  Immediately following the vote, community banks and credit unions object, saying the carve out will not work.

June 10, 2010

A bipartisan group of 131 House members, led by Rep. Debbie Wasserman Schultz, sends a letter to members of the conference committee on financial reform expressing “grave concerns” about the Durbin amendment.

July 21, 2010

President Obama signs Dodd-Frank into law. The original House version of Dodd-Frank did not include a price cap on interchange fees, so the House did not have the opportunity to review, debate, or vote on the Durbin amendment.  After a conference committee to resolve differences between the House and Senate versions, the Durbin amendment remained, along with a new provision relating to the routing of transactions – a provision not considered by either the full House or full Senate.

December 16, 2010

The Federal Reserve issues its draft rule on the Durbin amendment and holds a hearing, during which the Fed staff that drafted the rule acknowledges that consumers and small financial institutions could be harmed by the rule.

February 17, 2011

A House Financial Services Subcommittee and the Senate Banking Committee each hold hearings where interchange regulation is discussed.  Fed Chairman Ben Bernanke, FDIC Chairman Sheila Bair, and members of Congress express concerns about harmful unintended consequences, including impact on community banks and credit unions, as well as consumers.

March 15, 2011

Senators John Tester (D-MT) and Bob Corker (R-TN), and Congresswoman Shelley Moore Capito introduce separate legislation to delay the implementation of the Durbin amendment and require that a study be performed to determine how the Federal Reserve’s rules will impact consumers, small financial institutions and small businesses.

June 8, 2011

The U.S. Senate votes 54-45 on the Tester-Corker amendment, also known as the Debit Interchange Fee Study Act, but are unable to reach the 60 votes needed to overcome a filibuster. Because the votes did not meet the 60 vote threshold required to overcome a filibuster, the measure is defeated.

June 29, 2011

The Fed issues the final debit card rule.

October 1, 2011

The Durbin price caps on interchange fees begin, impacting card issuers with more than $10 billion in assets.

April 1, 2012

The routing and exclusivity provisions of the Durbin amendment enter into effect. There is no such exemption for smaller financial institutions in this provision.