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Senate to Vote on Credit Card Swipe Fees Bill

The Merchants Payments Coalition welcomed the announcement by Senator Roger Marshall, R-Kan., that the Senate plans to vote on the Credit Card Competition Act (CCCA), a bill that will reduce swipe fees.

“Today, we were given assurances that the Credit Card Competition Act will be given a vote this Congress,” Marshall says. “Swipe fees, the Visa-Mastercard duopoly and the Wall Street banks that back them are price gouging American families nationwide at a rate seven times higher than the EU. That will soon end.”

“Support for the Credit Card Competition Act is growing rapidly and we are confident it will pass once senators are given the chance to cast votes in favor of Main Street over Wall Street,” says MPC executive committee member and National Association of Convenience Stores general counsel Doug Kantor. “With fees growing by more than 20% each of the last three years, it is long past time for reform. Main Street and consumers need some relief, and a small modicum of competition is the bare minimum we should see. We won’t stop working to bring fairness to swipe fees until that victory is complete. We thank Senator Marshall for his leadership.”

First proposed last year, the CCCA was reintroduced in June by Marshall along with Sens. Richard Durbin, D-Ill.; Peter Welch, D-Vt., and J.D. Vance, R-Ohio, and by Reps. Lance Gooden, R-Texas; Zoe Lofgren, D-Calif.; Thomas Tiffany, R-Wis., and Jefferson Van Drew, R-N.J.

The bill is aimed at credit card swipe fees, which average 2.24% of the transaction but can range as high as 4%. Swipe fees have more than doubled over the past decade and rose $22 billion last year to a record $160.7 billion when debit cards are included. They are most merchants’ highest operating cost average labor, driving up prices by an estimated $1,024 a year for the average family.

Visa and Mastercard, which control over 80% of the market, currently price-fix swipe fees charged by banks that issue cards under their brands, and also restrict processing to their own networks. The legislation would require banks with at least $100 billion in assets to enable cards to be processed over at least two unaffiliated networks—Visa or Mastercard plus well-established, high-security competitors like NYCE, Star or Shazam. That would make networks compete over fees, security and service and is expected to save merchants and their customers $15 billion a year.

In addition to lower fees, the Federal Reserve says the competing networks have one-fifth the fraud of Visa and Mastercard’s networks. Credit card rewards would not be affected, nothing would change about which cards consumers use or how they use them, and community banks and small credit unions would be exempt.

The National Retail Federation offers an easy way for retailers to take action and has set up a website where retailers can send a message to their representatives.

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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