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Saturday, June 5, 2010

Protect Our Credit Unions!! TAKE ACTION TODAY, by contacting Congress!

It is extremely important to inform you about an issue that could negatively impact the members of credit unions across the country.

There is pending federal legislation that could affect the system that processes credit and debit card payments.

Each time you use your (particular local credit union) Visa® debit or credit card, a merchant is paid immediately and your credit union receives what is described as “interchange” through the card payment processing system. This complex interchange system reflects a merchant’s fair share of the costs (usually pennies on the dollar) of this convenient and beneficial payment system. It provides you with the ease of a credit or debit card and enables the merchant to instantly receive payment for your purchase without having to handle cash or wait for a check to clear.

At your particular credit union, it is likely they receive one-third of the interchange fee paid by the merchant, and each credit union may use this to:

* Help keep those cards free of, or with low, annual fees
* Pay for the cost of fraud and instantly issuing your particular credit union replacement card in the event of card breaches.

The U.S. Senate recently passed S. 3217, Restoring American Financial Stability Act, and the entire Congress is now considering the bill. Current amendments to the bill would be harmful to credit unions and consumers alike. While we recognize the need and we support financial reform, this specific provision – which has nothing to do with financial reform and has had no hearings, no debate, and no input – would reduce the amount of interchange fees paid by retailers and threaten our ability to offer debit and credit cards. This amendment is not good for consumers in the end.

The current bill and its concerning amendment is in front of the legislature now and slated for a possible vote soon. We encourage you to send a message today to your Congressional Representatives and Senators urging them to make this important issue more transparent with hearings and needed debate. Ask them to oppose any legislative changes to the interchange system which would affect debit and credit card-issuing credit unions and the card payment system until such hearings and debate can take place.

To simplify voicing your opinion, the Credit Union National Association (CUNA) has provided an online tool that helps you send a message to your federal legislators in a matter of a few minutes. Click here to send a message to your federal legislators today.

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