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The Federal Reserve issued its final rule amending Reg II’s debit card routing requirements, a rule CUNA, Leagues, and credit unions strongly opposed. It would require debit card issuers to offer two unaffiliated networks which must also be capable of processing transactions under a new framework.
“This final rule not only adds layers of unnecessary complexity to debit card networks, it will likely accelerate the decline in debit card revenue while increasing compliance costs,” said CUNA President/CEO Jim Nussle. “This rule has very little consumer benefits, while making it much harder for community financial institutions to offer safe, affordable card programs.”
Under the final rule, an issuer must configure each of its debit cards so that card-not-present transactions performed with those cards can be processed on at least two unaffiliated networks.
The rule becomes effective on July 1, 2023.