Comment from Persistence Analytics Group LLC

**Comment on NCUA–2026–1189** **Preemption — Federal Credit Union Non-Interest Charges and Fees** The National Credit Union Administration is correct to identify the operational risk created when state-level fee restrictions collide with national payment-card infrastructure. The issue is not only legal preemption. It is implementation integrity. Federal credit unions rely on payment-card networks, third-party processors, acquirers, issuers, merchants, fraud controls, dispute systems, and settlement infrastructure to provide ordinary consumer and merchant payment services. NCUA recognizes that FCUs routinely rely on third parties for payment cards and that these cards are deeply embedded in the American and global economy. The Illinois Interchange Fee Prohibition Act appears to assume that tax and gratuity components of transactions can be separated, identified, transmitted, reconciled, credited, and enforced without disrupting payment-card operations. That assumption requires verification. NCUA’s interim final rule identifies precisely why this matters. Current payment-card infrastructure may not support the automatic process required by the Illinois law, and implementation would require coordinated changes by card networks, acquirer and issuer FCUs, merchants, and standards bodies. NCUA also warns that implementation glitches or failures could disrupt global payment-card systems or create opportunities for fraud or misuse. That is the core point: A policy can be well-intended and still fail if the operating assumptions underneath it are not executable. Before any state law imposes transaction-level obligations on a national payment system, regulators should verify: 1. whether the required transaction data exists at the point of authorization or settlement; 2. whether merchants, acquirers, issuers, processors, and card networks can exchange that data reliably; 3. whether manual documentation processes are operationally feasible; 4. whether the issuer can be identified from available transaction records; 5. whether compliance can be automated without creating fraud or settlement risk; 6. whether smaller FCUs can absorb the technology, staffing, and liability burden; 7. whether consumers and merchants could face declined transactions or service disruption; 8. whether the penalty structure is proportionate to the operational reality. NCUA’s concern about potential disruption is not theoretical. The rule states that uncertainty could lead FCUs or networks to decline covered transactions, create consumer and merchant confusion, disrupt access to basic lending and deposit services, and pose risks to FCU safety and soundness or the banking system. The rule also notes that IFPA violations carry a $1,000-per-transaction civil penalty and estimates that, given billions of payment-card transactions in Illinois, potential liability could reach extraordinary levels. Persistence Analytics Group supports the need for an implementation-assumption verification layer in high-consequence financial, infrastructure, payment, and public-policy systems. The relevant standard should be simple: Trust the consumer-protection goal. Verify the payment rails. Prove executability before liability hardens. Respectfully submitted, Neil P. Osnato Founder Persistence Analytics Group LLC | United Grid National Security & Infrastructure Risk Analytics Demand Durability | Grid Stress | Load Integrity neil@persistenceanalyticsgroup.com 609-464-9055