At the end of July the Wall Street Reform and Consumer Protection Act was signed into law. The law impacts higher education in many ways.

The law creates a new Consumer Financial Protection Bureau (CFPB) that specifically has jurisdiction over any person or entity that offers “private education loans”. The CFPB will be a part of the Federal Reserve System  and has the power to issue and enforce regulations to protect consumers from abuses. The jurisdiction of the CFPB also covers entities that offer “private education loans”.

In addition, the law creates a Private Education Loan Ombudsman in the CFPB to resolve private education loan borrowers’ complaints. The Ombudsman is authorized to collaborate with the U.S. Department of Education, institutions, lenders, loan servicers, and guaranty agencies to resolve complaints.

The law also directs the Federal Reserve to  issue rules by April 21, 2011 to ensure that debit card interchange fees charged to debit-card-accepting merchants are reasonable and proportional to the cost of processing those transactions. This is a big benefit to university and college bookstores.

Finally, the law prohibits card networks from keeping any merchant, including universities, from setting minimum transaction amounts for credit card payments. However, the minimum transaction cannot be greater than $10. The card network also cannot prohibit any institution of higher education or federal agency from setting maximum transaction amounts or prevent any merchants from offering discounts for certain forms of payment.