The Merchants Payments Coalition (MPC) and the American Bankers Association (ABA) are engaged in a heated debate over the Federal Reserve's proposed changes to debit card interchange fees. In October 2023, the Fed suggested lowering the base interchange fee from 21 cents to 14.4 cents, a 30% decrease. These changes to Regulation II would also adjust fees related to fraud prevention and losses. The revision has been pending since the proposal was made, with no action taken despite public comments that typically prompt faster implementation. The ABA argues that these changes would significantly impact bank revenues, claiming that the data underpinning the proposal is flawed and influenced by pandemic-related issues. They've highlighted that 80% of the comments received oppose the fee cap reduction, warning it could lead to decreased banking services for low- and moderate-income consumers. They urged the Fed to reconsider its approach. In contrast, the MPC supports the proposed changes, labeling them overdue and asserting that the ABA's latest arguments do not introduce any new concerns. They argue that keeping the current fee structure benefits banks while harming consumers by maintaining high interchange rates. The MPC has pointed out that consumer organizations back the Fed's proposal, challenging the ABA's claims about the potential negative impacts on affordable banking services. The Fed has not provided a timeline for further action on the proposal.