The President's Perspective

Interchange debate continues, and DakCU’s CEO will be meeting today with Senator Cramer.  Plus, more information about the credit union “big splash” coming on July 30th! 

Greetings,
​
When is it okay to abruptly end a vacation?  Most of us would agree on that...never!  One of the hardest parts of a vacation, if not the hardest, is when it’s over and one needs to come back to reality.  The excitement of being with family or friends, the travel, the rest, and relaxation is now over, and it’s back to work, even before you’re ready or before you had planned to return to work.  Such is the case for me today.  I just got back from a much-needed respite with my kids to celebrate their successful sophomore and junior years away at college.

Today, I was invited, along with other professionals representing financial institutions, to attend and participate in a meeting with the North Dakota Retailers Association and ND Petroleum Marketers.  The meeting is being hosted by Senator Cramer in his Bismarck office.  The discussion will focus on credit and debit card interchange.  In late April, these two groups jointly filed a lawsuit against the Federal Reserve to reduce the interchange fees that are paid to credit unions, financial institutions, and other card issuers each time a consumer swipes their debit card.  The lawsuit argues that the Fed should lower the cap on interchange fees for debit card transactions. 
 
We been there, done that.
Interchange is the method that financial institutions, card networks and payments processors use to recover expenses for credit/debit cards.  As you know, this is not a new issue (or threat) to credit unions and other card issuers; it was just a decade ago that we first had this debate.  We know that Senator Cramer is being aggressively targeted by the two North Dakota groups to either introduce or co-sponsor interchange related legislation. 

Credit unions and banks are adamantly opposed to any efforts that would lower or eliminate debit card or credit card interchange fees.  In fact, many credit union leaders would consider this a level one or level two threat in our ability to function and serve our members; it’s an issue that is closely behind the elimination of credit unions’ federal tax exemption.

As we reported in the Memo last week, we recently joined the other financial service trade associations in North Dakota and signed on to a joint industry letter regarding prospective revisions pertaining to debit card and credit card interchange fees.

When Congress debated the amendment a little over a decade ago, retailers, merchants, and other supporters promised consumers would see billions of dollars in savings through a government-sponsored price control on interchange fees.  The truth of the matter is that those promised savings to have yet to materialize for members and consumers a decade later.
 
In fact, the consequences of interchange caps introduced by the Durbin Amendment in 2010 have only rewarded merchants who are now taking advantage of the COVID shutdowns to distort the competitive landscape further by restricting credit union members' and consumers their freedom to use safe, affordable, and innovative payment options that they choose.  The retailers' associations point to the coronavirus pandemic and consumers' increased use of cards for purchases as a core part of their argument.  However, one could argue that some businesses, particularly big box retailers, reported increases in revenue and market share.  In the United States the average interchange rate is around 0.3% for debit cards and 1.8% for credit cards.

Join us for Q1 2021 Open Your Eyes update
As you know, we’ve been working with the Credit Union Awareness team to keep the Open Your Eyes to a Credit Union® campaign going strong in the Dakotas!  We appreciate our Dakotas contributors’ support and look forward to sharing the latest performance data and findings with you in our Q1 2021 Campaign Update webinar.  Please join us on June 9th at 10:00 a.m. (CT) for the latest on this important initiative. 

Click here to register: Dakotas Open Your Eyes Campaign Update Webinar

During our webinar, we will provide a deep dive on Open Your Eyes campaign performance nationwide, covering topics including Media budget and impact; Overall campaign performance; Creative asset review and performance; Updates, upgrades, and planned new features and integration.  We will also be fielding any questions you have. 

Apply Now for 2021 CUNA Awards
While we just celebrated the achievements of our member credit unions during the Summit in Fargo, it’s already time to submit your applications for CUNA's National Awards.  These awards are designed to encourage and recognize credit unions that demonstrate social responsibility (the Dora Maxwell Award), credit union philosophy (the Louise Herring Award), and financial education (the Desjardins Awards).  Find more information here on our website and submission instructions and forms are located here on CUNA’s website.  Don’t miss the June 25 deadline!

Make the Most of Your Scholarship Announcements
It’s exciting to note the many scholarships that our member credit unions are awarding this year.  We can help you amplify your impact, so be sure to share your scholarship news for the Memo and for CU Social Good.  There’s nothing like a little free earned media to keep credit unions “first in mind” with consumers.  Send your announcements to Shawn Brummer.
 
Mark it, July 30th – we’re going viral!
You know what they say, “go big, or go home.” The credit union difference is a message worth sharing and we’re gearing up to spread the word.  Several weeks ago, I asked you to mark your calendars for July 30 in anticipation of something big.  We can now share that on that day, credit unions and leagues across the country are going to try to “break the internet” with an organized social media campaign led by the Illinois Credit Union League.  This day, the credit union movement will come together to inspire credit union teams and members to share what’s best about their CU experience using a common hashtag.  We look forward to creating a digital wave of authentic, high-energy conversation on social media to raise awareness about the amazing things our credit unions do every day for their members and communities. 

Making it happen is simple for you, thanks to the resource hub developed by our friends at the Illinois Credit Union League.  Here, you can sign up to participate and access everything you’ll need to plan and engage members in this exciting, nationwide collaboration.  You’re welcome to personalize the materials with your own branding, design your own content, and add those unique touches that will speak to your membership.  Just remember to keep that hashtag under wraps until July 30 for the biggest impact!     

Have a great week,

​President/CEO
Dakota Credit Union Association