FOR IMMEDIATE RELEASE
ICBA Warns Congress Government Price Controls in Efficient Payments Network Will Harm America’s Economy
Current Efficient System Benefits Retailers and Consumers
Washington, D.C. (July 19, 2006)—The Independent Community Bankers of America's (ICBA) Executive Vice President for Government Relations Karen Thomas issued the following statement today in response to a Senate hearing on credit card interchange policies.
"ICBA is pleased that lawmakers had the opportunity to learn more about our efficient electronic payments network and the value it provides to our nation's retailers and consumers. Community banks are proud to partner with the credit- and debit-card networks to facilitate commerce and economic growth in communities throughout the country.
Robust competition among banks seeking to serve and attract customers has created a marketplace driven by innovation and cards with lower fees and greater rewards than ever before. ICBA is concerned about the detrimental effects that price controls or other government regulation would have on our nation's electronic payments network.
New government regulation, such as price caps on interchange rates, would inevitably harm consumers by disrupting banks' ability to offer low-fee cards to consumers and would reduce the variety of rewards programs that customers have come to expect. The result would be higher annual fees and interest rates for cardholders and a reduction in rewards programs and other benefits for consumers.
The unintended consequences would not only be harsh and harmful for community banks across the country, but for their customers and their local economies. The current system—with innovation and competition—is working well for local banks and their cardholders. Let's let it continue to do so."