Local Illinois financial institutions were joined by members of the Illinois State
Black Chamber of Commerce and the Illinois Hispanic Chamber of Commerce in Springfield
today to sound the alarm on the countdown to credit card chaos as the flawed Interchange Fee
Prohibition Act is set to take effect on July 1, 2025.
Last May, an undebated, last-minute provision was included in Illinois’ budget package that will
establish Illinois as a radical outlier in the global payments system and will upend the way credit
and debit cards work across the state. With no workable technology and no system in place as it
has never been done anywhere in the world, it is unknown how Illinois financial institutions,
business owners and consumers will be able to comply with the law. Illinois consumers could be
forced to pay tax or gratuity in cash or by check, and purchases might require two transactions.
“With a July 1 implementation date, and no workable technology on hand, the only guarantee is
that chaos will reign at the register for millions of credit card users and over a million small
businesses in Illinois,” said Randy Hultgren, President and CEO of the Illinois Bankers
Association. “This flawed policy must be repealed in the best interests of local financial
institutions and the millions of Illinoisans who rely on a safe and secure payment system.”
“Our credit unions take individuals with no credit, or low credit, and counsel them into positions
of financial strength, allowing them to purchase homes and pursue the American dream,” said
Libby Calderone, President and CEO of the Illinois Credit Union League. “If this law goes into
effect, it will negatively impact the ability of credit unions to continue offering credit and debit
cards that help consumers meet the demands of everyday life.”
The Illinois Bankers Association and the Illinois Credit Union League were among a group of
plaintiffs who filed litigation to challenge the law last August. A partial preliminary injunction
was granted in December, ruling that national banks, federal savings banks and out of state
banks would be exempt from complying from the law.
However, if no other rulings are issued by July 1 and the General Assembly does not take
action to repeal the law, Illinois’ own state-chartered banks, as well as state and federal credit
unions, will still have to comply with this law.
Last October, the Office of the Comptroller of the Currency, which charters and examines
national banks, filed an amicus brief stating that the IFPA “is an ill-conceived, highly unusual and
largely unworkable state law,” and “it is likely that fraud risk would increase significantly,
consumer services would be constrained, and public trust would decline.”
Small businesses will be left with headaches while corporate megastores will be the
beneficiaries. A new study analyzing the cost implications of an Illinois credit card law shows 40
of the largest retailers will soak up nearly 40 percent of the estimated $118 million reduction in
interchange. This is why corporate megastores publicly support the legislation in other states.
“It’s clear that this misguided policy will only benefit corporate megastores while small business
owners will be stuck with implementation costs and burdens,” said Larry Ivory, President and
CEO of the Illinois State Black Chamber of Commerce. “We urge Illinois legislators to repeal this
law before it harms over one million small businesses across the state.”
Similarly, the Illinois Hispanic Chamber of Commerce is advocating for repeal of this law on
behalf of its members.
“At the Illinois Hispanic Chamber of Commerce, we stand with our members and the broader
Hispanic business community in advocating for policies that support economic growth and
stability,” said Jaime di Paulo, President and CEO of the Illinois Hispanic Chamber of Commerce.
“The Interchange Fee Prohibition Act (IFPA), rushed through at the end of last spring’s legislative
session, threatens to create confusion and financial harm for our small businesses and the
consumers they serve. We urge the Illinois legislature to repeal this misguided law and prioritize
the needs of our local entrepreneurs and communities.”
A link to the press conference can be found here. For more information, visit
www.guardyourcard.com/illinois.