The American Bankers Association will air a television ad during Tuesday’s presidential debate urging policymakers to reject a Federal Reserve proposal to lower the cap on debit card interchange fees, saying the change would amount to a corporate megastore bailout.
The Fed last year proposed revising Regulation II to lower the cap from its current rate of 21 cents and .05% of the transaction, plus a one-cent fraud adjustment, to 14.4 cents and .04% per transaction and a 1.3 cents fraud-prevention adjustment, effective June 30, 2025. In the ad, a series of falling dominos illustrates the “domino effect” that would result from the policy change, noting that consumers lost their rewards program when the cap was first enacted while corporate retailers kept the savings they had promised to share. Those same megastores are now pushing to lower the cap even further, which would result in many of the neediest bank customers losing banking access, according to ABA.
“Megastores win and you pick up the pieces,” the ad states. “Tell the White House and the Fed to stop the corporate megastore bailout.” ABA is also providing an online form that bankers and other members of the public can use to urge the Fed to reject Reg II proposal.
