OCC order preempting Illinois card interchange and data-use limits
AI-generated summary for informational purposes only. Not legal advice. See the original source for the authoritative text.
This order says Illinois cannot apply its Interchange Fee Prohibition Act to national banks and federal savings associations. The OCC says federal law overrides two parts of the Illinois law: the ban on charging interchange fees on tax and tip portions of card transactions, and the limits on how banks can use payment-card transaction data. For banks and card-network participants, the practical effect is that they do not have to comply with those Illinois restrictions while the order is in effect. Illinois merchants and payment processors may still need to watch for operational changes, but the main compliance burden shifts away from OCC-supervised institutions. Comments are open until May 29, 2026, and the order takes effect June 30, 2026.
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Key Changes
- Blocks Illinois from enforcing its ban on interchange fees for the tax and tip portions of card transactions against national banks and federal savings associations.
- Blocks Illinois from enforcing its limits on how payment-card transaction data may be shared or used by those institutions.
- Removes the need for OCC-supervised banks to change pricing, processing, or data-handling practices to follow the Illinois law.
Obligations
What this law requires
OCC-supervised national banks and Federal savings associations are not required to comply with the Illinois Interchange Fee Prohibition Act's ban on charging or receiving interchange fees on the tax and gratuity portions of payment card transactions while the order is in effect.
OCC-supervised national banks and Federal savings associations are not required to comply with the Illinois restriction on the use of payment card transaction data while the order is in effect.
Illinois merchants informing acquirer banks of tax or gratuity amounts must continue to transmit that information as contemplated by the Illinois law until the law is displaced for the covered institutions; the order does not create a new affirmative federal compliance duty for merchants, but the underlying state framework remains relevant outside the preempted scope.
Interested parties may submit public comments on the interim final order by the stated comment deadline.
Comment submissions must identify the agency as 'OCC' and include Docket ID 'OCC-2026-0431'.