Enacts the interchange fee prohibition act

2025 Regular Session Introduced by Jeremy Cooney

Prohibits interchange fees on card payments, lowering merchants' card-processing costs while forcing banks and networks to adjust pricing; consumers may see indirect price effects.

REFERRED TO CONSUMER PROTECTION

Overview

S 5558, titled the Interchange Fee Prohibition Act, is a proposed bill introduced on February 25, 2025. The bill is currently REFERRED TO CONSUMER PROTECTION, indicating it will be reviewed by the consumer protection committee before any further legislative action. The primary sponsor is Jeremy Cooney. A companion bill exists in the Assembly as A 6603.

Purpose and intent

The bill appears to aim to prohibit interchange fees. Interchange fees are charges paid by merchants to card-issuing banks and, by extension, to card networks as part of processing card-based transactions.

The likely intent, based on the title, is to reduce or eliminate these fees to merchants, potentially lowering the cost of accepting card payments and increasing price transparency for merchants and consumers.

Key provisions (based on the bill’s title and standard structure)

The exact text is not provided here, but a bill with this title would typically include:
- Prohibition of interchange fees charged in connection with card-based transactions.
- Definitions for terms such as "interchange fee," "card network," "card issuer," and "merchant."
- Enforcement mechanisms and penalties for noncompliance.
- Effective date or phased implementation timeline.
- Possible exemptions or carve-outs (e.g., certain types of card transactions or small merchants) and any rulemaking authority.
- Procedures for rulemaking, enforcement actions, and remedies.

Note: The above provisions are inferred from the bill’s title; the actual statutory language could differ.

Affected parties and potential impact

Merchants: Likely primary affected group, as prohibiting interchange fees would reduce a cost of accepting card payments.

Banks and card networks: Card-issuing banks and networks could experience reduced revenue from interchange fees; the bill may prompt changes in pricing or business models.

Payment processors and acquirers: These entities may adjust contractual terms and fees passed to merchants.

Consumers: Indirect effects could include changes in merchant pricing, rewards structures, or surcharges, depending on how costs are redistributed.

Procedural and timeline aspects

Status: Referred to the Consumer Protection committee (as of the latest action).

Legislative actions: Both entries on 2025-02-25 indicate referral to Consumer Protection; duplication appears in the record but does not indicate additional action.

Related legislation: A companion bill exists in the Assembly, A 6603, indicating parallel consideration in another chamber.

Notes

No specific dollar amounts, percentages, or dates beyond the introduction date are provided in the available information.

The bill’s progression will depend on committee review, potential amendments, and subsequent floor votes in both chambers if it advances.

If you’d like, I can tailor this summary further once text from the bill is available or track updates as it moves through committee stages.

Bill