From a glass-half full point of view, credit unions are being encouraged to consider the upside of the Durbin Amendment. Upside, meaning the opportunity to leverage their exempt status by reaching out to disgruntled bank customers, launching prepaid card initiatives, and processing more transactions from small merchants who may not be able to take advantage of the new routing rules.
“In summary, there is opportunity for credit unions in the changing marketplace. Of course, just how much they are able to capitalize on that opportunity depends on their ability to preserve margins and capture new business. Some interchange margin preservation will be beyond their control, but opportunities exist in building DDA relationships with new consumer prospects.”
As the debit issuing market settles in to its new reality (much of which is still unknown), creating a balance between risk and opportunity will not be easy. Especially for smaller institutions that have fewer capital and material resources to work with, addressing any potential market openings could be a challenge all by itself.