NGA Submits Comments Stating Rule Undermines Competition and Raises Costs for Independent Grocers and Consumers
Washington, D.C. – The National Grocers Association (NGA), the trade association representing the independent supermarket industry, today submitted comments to the Office of the Comptroller of the Currency (OCC) opposing its interim final rule revising 12 C.F.R. § 7.4002 and the related interim final order concerning the application of the Illinois Interchange Fee Prohibition Act (IFPA) to national banks.
The OCC rule represents a significant departure from longstanding federal banking policy by explicitly authorizing national banks to receive interchange fees established through third-party arrangements rather than through competition among banks.
“NGA strongly opposes the OCC’s interim final rule, which permits national banks to establish interchange fees through third-party arrangements,” said Greg Ferrara. NGA president & CEO. “This approach undermines competition and increases costs for independent community grocers and the customers they serve.”
In its comments, NGA outlined concerns that the rule will increase costs for independent grocers and consumers while weakening the competitive market forces that have historically governed fee-setting authority under the National Bank Act. Further, because interchange fees are embedded in nearly every card transaction, the OCC’s rule will have far-reaching negative consequences for community grocers, consumers, and competition throughout the marketplace.
“Independent grocers serve communities in every corner of the country, and interchange fees are embedded in nearly every card transaction,” Ferrara said. “As a result, the OCC’s interim final rule would have far-reaching negative consequences for community grocers, consumers, and competition throughout the marketplace. NGA appreciates President Trump’s support for lowering swipe fees through the Credit Card Competition Act. Unfortunately, the OCC’s decision moves in the opposite direction, reinforcing the market dynamics that have driven interchange fees higher and increased costs for businesses and consumers.”
NGA urges the OCC to withdraw the rule and preserve the longstanding principle that fee-setting authority under the National Bank Act should remain grounded in competition among banks.
NGA submitted comments to the OCC urging the agency to withdraw the proposed rule, warning that it could undermine competition and increase costs for merchants and consumers.
The comments can be viewed here.
###
About the National Grocers Association
NGA is the national trade association representing the retail and wholesale community grocers that comprise the independent sector of the food distribution industry. An independent retailer is a privately owned or controlled food retail company operating a variety of formats. The independent grocery sector is accountable for about 1.2 percent of the nation’s overall economy and is responsible for generating more than $250 billion in sales, 1.1 million jobs, $39 billion in wages and $36 billion in taxes. NGA members include retail and wholesale grocers located in every congressional district across the country, as well as state grocers’ associations, manufacturers and service suppliers. For more information about NGA, visit www.nationalgrocers.org.
