A group of nine merchant trade groups filed two federal lawsuits against the OCC and National Credit Union Administration for their interim rules preempting an Illinois interchange law.
New Suit: The lawsuits contend the agencies exceeded their authority in issuing the interim rules earlier this year.
Agency Rules: The OCC’s interim final rule and interim final order clarify longstanding powers under federal law for national banks to charge interchange fees, preempting the Illinois law for national banks and federal savings associations while leaving it to apply to Illinois-chartered institutions.
Illinois Law and Delay: The Interchange Fee Prohibition Act would prohibit the application of interchange fees on the tax and tip portion of a transaction. The Illinois General Assembly this year voted to delay implementation of the IFPA by a year to July 1, 2027—the measure’s second one-year delay since it was passed in 2024.
Court Injunction: In line with the OCC’s announcement, the U.S. District Court for the Northern District of Illinois issued an injunction preventing Illinois from enforcing the law on national banks, banks chartered by states other than Illinois, federal savings associations, and the payment card networks—again leaving Illinois-chartered institutions subject to the state’s punitive law.
ICBA Advocacy:
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ICBA expressed support for the OCC’s interim final order and urged the agency to finalize the order without delay.
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In a separate letter, ICBA signaled strong support of the OCC’s interim final rule clarifying national banks' authority to charge noninterest charges and fees.
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ICBA and 43 state banking associations previously said they support the OCC order, adding that the IFPA would pose serious risks to the card payment system.
Resource for Community Bankers: ICBA in February unveiled an Interchange Guide that breaks down payment card interchange and other swipe fees to help community bankers communicate the issue with their customers.