![]() "Interchange revenue will dry up," according to Aaron Stetter, the executive director of the Electronic Payments Coalition. Shares of Visa and Mastercard are up more than 12% each this year as of Friday's close. Mastercard did not provide a response despite CNBC's multiple attempts to get one. All declined to comment or referred us to the Electronic Payments Coalition. The Electronic Payments Coalition, a group representing big banks, credit unions, community banks and payment card networks said the legislation "would add billions of dollars to the bottom lines of mega-retailers every year while eliminating almost all the funding that goes towards popular credit cards rewards programs, weakening cybersecurity protections, and reducing access to credit," in a June 9 post on its website.ĬNBC reached out to major credit card companies including Visa, American Express, Discover and Capital One. Larger platforms and retailers like Amazon, Shopify and Walmart, as well as payment processors and issuers like Capital One, Discover and Visa, are funding efforts to pass or block this bill. In total, 26 organizations have mentioned the Credit Card Competition Act by name in their 2023 first-quarter lobbying reports, which were filed before the legislation was reintroduced last month, according to data from Open Secrets, a nonprofit group tracking campaign finance and lobbying data. ""Relative to every other country Shopify operates in, interchange fees are the highest in America," Finkelstein said. The e-commerce platform known for helping businesses create their own custom digital stores, operates in 175 countries worldwide. "We began to notice that these fees kept climbing and climbing and climbing, and we felt that something was up." ![]() "Interchange fees are effectively a tax on commerce," said Shopify president Harley Finkelstein. The bill also stipulates that Visa and Mastercard can only account for one of the choices as a way to prevent the two largest networks from being the only options offered to merchants. The new legislation would require banks with assets over $100 billion to provide customers with a choice of at least two different payment networks to process credit card transactions. That's why some businesses add a surcharge to bills for customers paying with debit or credit cards to encourage cash transactions. credit card swipe fees account for 2.24% of a transaction, according to the Merchants Payments Coalition. ![]() Swipe fees are often built into the price consumers pay for goods and services and have more than doubled in the past decade, hitting a record $160.7 billion in 2022, according to the Nilson Report. Durbin says the legislation would "help reduce swipe fees and hold down costs for Main Street merchants and their customers." Visa and Mastercard account for 80% of all credit card volume, according to data from the Nilson Report, a publication tracking the global payment industry. He's a sponsor of the bill and one of its most outspoken advocates. Dick Durbin, D-Ill., said in a statement to CNBC. "It's time to inject real competition into the credit card network market, which is dominated by the Visa-Mastercard duopoly," Sen. As of now, there is no vote scheduled on the measure in either chamber of Congress, but there are indications a vote could come by year-end.ĭoug Kantor, a member of the Merchants Payments Coalition executive committee, remains "optimistic" that the Credit Card Competition Act could end up as an amendment attached to a larger piece of legislation at some point. On the other side of the fight, major credit card processing networks and issuers like Visa, Mastercard, Discover and Capital One say the bill will actually hurt consumers by diminishing popular credit card rewards programs and lessening fraud protections.īipartisan support for the bill has surged since it was introduced last year. Retailers in support of the legislation argue credit card processing costs are hurting consumers by driving up the cost of business, and, in turn, the price shoppers pay at checkout. This would give merchants who pay interchange fees a choice they otherwise rarely get.Īmazon, Best Buy, Kroger, Shopify, Target and Walmart are among the list of nearly 2,000 retailers, platforms and small businesses urging lawmakers to pass the bill. The measure aims to bolster competition for credit card processing networks by requiring big banks to allow at least one network that isn't Visa or Mastercard to be used for their cards. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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