Duncan Douglass was extensively quoted in a Transaction World Magazine article discussing the 111th Congress’ bold actions in regulation of the credit card industry. “Congress has been tremendously active in legislating to the card industry over the past year,” he said. “The Credit CARD Act has been the most noteworthy piece of legislation actually enacted, but bills directed towards capping interest rates, changing the manner in which merchant discount rates are negotiated and establishing a new federal regulator to oversee consumer financial products have been pushed farther and harder over the past year than in prior years.” He continued: “My concern with congressional action in the card industry is twofold. First, I worry that Congress sometimes acts to demonstrate that it is doing something, even where not taking action would be the better long-term solution. Second, I believe the blunt instrument of legislation is sometimes applied in contexts that really require more carefully studied and precisely crafted regulation.”
As to the question of if Congress will subsequently legislate for small businesses, Douglass said, “I don’t anticipate congressional action specifically targeted to small businesses in general or ISOs in particular. Certainly there are proposals in Congress that would benefit small businesses, such as the Conyers/Durbin merchant discount bills, but Congress appears for now to remain focused on general risks within the financial services industry and on consumer protection more so than on the protection of small businesses and ISOs.”