The American Bankers Association today joined other national associations and state bankers associations in submitting a trio of letters expressing their support for recent actions by the Office of the Comptroller of the Currency to reaffirm federal preemption of state attempts to regulate interchange fees, as in Illinois.
In April, the OCC issued an interim final order confirming that federal law preempts the Illinois Interchange Fee Prohibition Act, or IFPA. The agency also issued an interim final rule confirming the longstanding powers under federal law for national banks to charge a broad range of fees, regardless of whether those fees are set by the bank or a third party.
Since the IFPA was enacted into law in 2024, other states have explored similar laws, with Colorado lawmakers recently passing legislation to ban the collection of interchange fees on sales taxes. Colorado Gov. Jared Polis has not said whether he intends to sign the bill or veto it. In addition, ABA, the Illinois Bankers Association and other groups have challenged the IFPA in court.
ABA and the other associations said the OCC’s actions will provide much-needed regulatory certainty to bank customers and financial institutions of all stripes.
“To avoid such a balkanization of today’s uniform payments ecosystem that would invariably limit American consumers’ and American businesses’ access to financial services on which they rely daily, our uniform national bank system and its constituent parts must, as the OCC expressly recognizes, always be defended from impermissible state overreach,” ABA and the state bankers associations said in their letter.
