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Card-scheme rules (Visa/Mastercard) govern most US card acceptance, overlaid with PCI DSS and the federal interchange/routing regime. Debit interchange is capped under the Durbin Amendment (Dodd-Frank §1075) via Federal Reserve Regulation II at 21 cents + 5bps + 1 cent fraud adjustment for issuers with $10bn+ assets, with mandatory dual-network routing. Regulation II's standard faced a major 2025 legal challenge. Credit interchange remains unregulated by statute and is the subject of the long-running merchant antitrust litigation.
The underlying statutory regime remains the Durbin Amendment as implemented by Regulation II, capping debit interchange at 21 cents plus 5 basis points plus a 1 cent fraud adjustment for issuers with $10bn or more in assets, with mandatory dual-network routing; issuers under $10bn are exempt. This statutory debit interchange and routing regime is foundational to US card economics and merchant routing choice. Credit interchange, by contrast, remains unregulated by statute and is the subject of the MDL 1720 antitrust litigation tracked under W7.
Outlook
The Federal Reserve's appeal of the August 2025 vacatur is expected in the second half of 2026, and the Fed's separate proposal to lower the base interchange component to 14.4 cents is the parallel rulemaking track to watch; both are at consultation stage. The trajectory is escalating. A noted gap is that PCI DSS v4 and 3DS/SCA scheme-compliance specifics are not separately evidenced beyond general statement, as scheme rulebook detail is not available through member channels.
Scheme & Network Compliance
US card-scheme economics are in a state of live legal disruption. The Durbin Amendment, implemented through Regulation II, caps debit interchange at 21 cents plus 5 basis points plus a 1-cent fraud adjustment for issuers with $10bn or more in assets, mandates dual-network routing for debit transactions, and exempts issuers below the $10bn asset threshold entirely. In August 2025, a federal district court — ruling on remand from the Supreme Court's decision in the Corner Post litigation — held that the Regulation II interchange standard was contrary to the statutory text of the Durbin Amendment and vacated it, though the court stayed its own vacatur pending the Federal Reserve's appeal. If the vacatur is ultimately upheld, it would unsettle the 21-cent-plus-5-basis-point-plus-1-cent cap that has governed debit-issuer economics since Regulation II's introduction. Separately, and independently of the litigation, the Federal Reserve has proposed lowering the base component of the interchange cap to 14.4 cents, citing Senator Durbin's own argument that the average per-transaction processing cost was only 3.9 cents in 2021 — a proposal that, if adopted, would move in the opposite direction from a full vacatur.
Outlook
The Federal Reserve's appeal of the August 2025 vacatur is expected to play out over the second half of 2026, and its outcome — together with resolution of the Fed's separate 14.4-cent proposal — will materially reset debit-interchange economics for issuers with $10bn or more in assets and shape merchant routing incentives across the dual-network system.
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Sources and findings (4)
- T1Congress.gov CRS R41913 — The Durbin Amendment (Dodd-Frank §1075) authorises the Federal Reserve to ensure debit interchange fees are reasonable and proportional; issuers with under $10bn in assets are exempt, and networks/issuers cannot restrict a merchant's choice of routing network.
- T3Cooley — Regulation II, promulgated by the Federal Reserve in June 2011, sets a universal debit interchange cap of 21 cents plus five basis points of transaction value, with a one-cent fraud-prevention adjustment.
- T3Cooley — In August 2025 a federal district court (on remand from the Supreme Court in the Corner Post litigation) held Regulation II's interchange standard contrary to the Durbin Amendment and vacated it, while staying its own vacatur pending appeal by the Federal Reserve.
- T2durbin.senate.gov — The Fed had separately proposed lowering the debit interchange base component to 14.4 cents, with Senator Durbin urging an even lower cap citing average per-transaction processing cost falling to 3.9 cents in 2021.