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NAFCU cybersecurity and payments committee discusses interchange, digital currency
NAFCU's Cybersecurity and Payments Committee met yesterday to discuss the latest
developments on interchange, the Federal Reserve issuing a request for comment (RFC) to seek input on proposed guidelines for evaluating requests for accounts and services at Federal Reserve Banks, central bank digital currency, and more.
During the meeting, committee members shared insights into their credit unions' interest in pursuing new payments-related initiatives or projects.
Committee members received a briefing from NAFCU staff regarding renewed efforts to the North Dakota-based associations representing retailers lawsuit filed against the Federal Reserve, arguing the Fed should lower the cap on interchange fees for debit card transactions. NAFCU has already issued a statement opposing any efforts that would lower debit card interchange fees.
In early May, the Federal Reserve reopened comment on Regulation II to address routing practices. The recently published proposal states that debit card issuers should enable, and allow merchants to choose from, at least two unaffiliated networks for card-not-present transactions. The proposal does not make changes to provisions related to interchange fee pricing or alter the exemption granted to small debit issuers under $10 billion in assets.
NAFCU has published a regulatory alert summarizing the proposal. Comments on the proposal are due to the Federal Reserve July 12, 2021.
Also on the agenda:
Federal RFC: Guidelines for evaluating account and services requests
The committee discussed the Federal Reserve issuing an RFC as they are seeking input on proposed guidelines for evaluating requests for accounts and services at Federal Reserve Banks. The proposed account access guidelines are intended to create a uniform and transparent framework for evaluating access requests for Reserve Bank services centered on a foundation of risk management and mitigation. NAFCU has published a regulatory alert summarizing the proposal. Comments are due to the Federal Reserve on July 12, 2021.
Central bank digital currency
NAFCU staff also provided an update on the Federal Reserve’s recent actions and statements concerning development of a central bank digital currency, sometimes referred to as a “digital dollar.”
Interagency request for information – artificial intelligence (AI)
The committee also talked about how NCUA along with other federal banking agencies issued a joint request for information (RFI) to solicit comment on AI and machine learning usage within the financial sector. NAFCU has published a regulatory alert summarizing the proposal. Comments are due to the NCUA and other agencies on July 1, 2021
NAFCU’s Cybersecurity and Payments Committee will next meet September 7, 2021