ALBUQUERQUE, N.M. — The Credit Union Association of New Mexico said it recently hosted a roundtable with credit union executives, small business owners and congressional staff to discuss concerns over the proposed federal Credit Card Competition Act and its potential impact on community financial institutions and consumers.
According to the association, the event was held in partnership with the Small Business Payments Alliance and included staff members from the offices of U.S. Sens. Martin Heinrich and Ben Ray Luján.
As the CU Daily has been reporting, the proposed Credit Card Competition Act would require certain credit cards to be enabled on at least two unaffiliated payment networks, allowing merchants to choose how transactions are routed. Opponents of the legislation argue the measure could weaken fraud prevention and cybersecurity protections tied to existing payment systems. Supporters of the legislation have been looking for a vehicle to which to attach the CCCA in Congress but have been unable to do so to date.
‘Could Create Risks’
“When a consumer uses a credit or debit card, a small fee known as interchange helps fund the systems that make those transactions possible,” the Credit Union Association of New Mexico said in a statement, noting those fees support fraud monitoring, cybersecurity and payment processing infrastructure.
Melia D. Heimbuck, president and CEO of the association, said the legislation could create risks for consumers and financial institutions.
“Credit unions are focused on protecting their members and ensuring they have access to safe, reliable financial services,” Heimbuck said. “Interchange supports the security and infrastructure behind everyday transactions. Proposals like the Credit Card Competition Act risk increasing fraud, reducing consumer benefits, and limiting access to credit for the people who need it most.”
Reps from Four CUs in Attendance
The association said representatives from First Financial Credit Union, Nusenda Credit Union, Rio Grande Credit Union, Sunward Federal Credit Union and Zia Credit Union participated in the discussion and expressed concerns that changes to the current payments system could reduce fraud protections and increase operational risks.
Participants at the roundtable also raised concerns that increased fraud losses could lead lenders, including credit unions, to tighten credit standards, potentially reducing access to credit for lower-income and underserved consumers, according to the CUANM.
The association said the discussion gave congressional staff an opportunity to hear directly from New Mexico businesses and credit unions about the possible effects of federal payments legislation on local communities.
