Debit Card Interchange Fees and Routing

The Board is publishing a clarification of Regulation II (Debit Card Interchange Fees and Routing). Regulation II implements, among other things, standards for assessing whether interchange transaction fees for electronic debit transactions are reasonable and proportional to the cost incurred by the issuer with respect to the transaction, as required by section 920 of the Electronic Fund Transfer Act. On March 21, 2014, the Court of Appeals for the District of Columbia Circuit upheld the Board's Final Rule. The Court also held that one aspect of the rule--the Board's treatment of transactions- monitoring costs--required further explanation from the Board, and remanded the matter for further proceedings. The Board is explaining its treatment of transactions-monitoring costs in this Clarification.