Federal Reserve Board Chairman Bernanke told Congress yesterday that the Fed won’t be able to meet the April 21st deadline set by the Dodd-Frank Act for regulating the debit card business. Unlike the student who turns her homework in late, the Fed should be applauded for taking more time to get its job done right rather than adhering to the rushed deadlines set by Congress.
It’s clear to anyone who has read the many questions that the Fed put out for comment in late December or listened to the Board hearing that—not surprisingly—regulating the highly complex, multi-trillion debit card market isn’t something mortals could do responsibly in nine months from an almost standing start. The additional time will hopefully enable the Fed to sort out how to compensate debit card issuers for fraud prevention before imposing any possible rate caps.
Chairman Bernanke has assured Congress that the Fed will meet the July 21st deadline for imposing the rules. Perhaps before then, Senator Durbin will agree that enough questions have been raised—even if they haven’t all been answered—over whether his bill is really in the public interest that he will do the right thing and take the time out, mandated by the Tester Debit Card Study Act, to make sure that consumers, especially lower income ones, don’t get the short end of the stick.
Debit Stakeholders Face Off at PYMNTS.com Durbin Conference
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