Feb. 12 public comment date set on Fed’s proposal to reduce maximum debit interchange fees

The Federal Reserve Board’s proposed reduction in the maximum fees that debit card issuers could receive per debit card transaction has been given a public comment deadline of Feb. 12, according to a notice in Tuesday’s Federal Register.

The Fed, which issued the proposal last month, said its proposed rule would bring a reduction in the fee cap on an average-sized, $50 debit card transaction from 24.5 cents to 17.7 cents.

Initially under the proposal, the base component of the interchange fee cap would be 14.4 cents (down from 21.0 cents), the ad valorem component would be 4.0 basis points (down from 5.0 basis points, and multiplied by the value of the transaction), and the fraud-prevention adjustment would be 1.3 cents (up from 1.0 cent) for debit card transaction performed from the effective date of the final rule to June 30, 2025.

The Fed said its proposed revisions would also codify in regulation an approach for updating these above three components every other year going forward based on the latest data reported to the Fed Board by covered issuers.

Reg Lookup: Debit Card Interchange Fees and Routing