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Reining in Fees: U.S. House and Senate to Vote on Credit Card Competition Act

AIMED AT ENHANCING COMPETITION and choice in the credit card network market, the Credit Card Competition Act (CCCA) was introduced in July 2023 into the U.S. House and Senate.

The CCCA strives to reduce credit card interchange fees, also known as swipe fees, and create a more competitive environment for merchants accepting credit cards as payment. Currently, American Express, MasterCard and Visa dominate the market with four banks—Chase, Citi, Wells Fargo and Bank of America—issuing nearly half of all credit cards.

The legislation would require all banks with at least $100 billion in assets to allow cards to be processed over at least two unaffiliated networks—Visa or MasterCard—plus well-established, high-security competitors like NYCE, Star or Shazam. If passed, it is expected to save merchants and their customers $15 billion a year, according to the Merchants Payments Coalition.

Several independent retail organizations, including the North American Hardware and Paint Association, signed a letter in support of the CCCA. Small Business Rising, a coalition of small business membership associations representing more than 200,000 independent businesses, authored the letter, which was sent to co-sponsors of the bill to show support for the legislation and thank the sponsors for helping small businesses.

  • In 2022, merchants paid $160.7 billion in credit and debit card swipe fees, up from $138 billion in 2021.
  • On average, credit card swipe fees make up 2.24% of the transaction but can reach as high as 4%.
  • Credit card swipe fees drive up prices by an estimated $1,024 a year for the average U.S. family.

Sources: Nilson Report 1237, Nilson and Credit Card Competition Act: Myths & Facts, Merchants Payments Coalition

How To Support the Bill

Visit the National Retail Federation’s Fed Up With Fees Headquarters, which offers news updates on the bill, directions on how to contact Congress and a way to request signs and window clings retailers can put in their stores to show support: nrf.com/FedUpWithFees

Join Small Business Rising (smallbusinessrising.org), a coalition of independent business organizations standing up for a level playing field.

About Lindsey Thompson

Lindsey joined the NHPA staff in 2021 as an associate editor for Hardware Retailing magazine. A native of Ohio, Lindsey earned a B.S. in journalism and minors in business and sociology from Ohio University. She loves spending time with her husband, two kids, two cats and one dog, as well as doing DIY projects around the house, going to concerts, boating and cheering on the Cleveland Indians.

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