Associations from every state and Puerto Rico sent a letter to Congress.

January 12, 2024

Almost 2,000 companies and nearly 300 trade associations called on Congress to pass the Credit Card Competition Act as lawmakers returned to Washington this week, the Merchants Payments Coalition said in a press release.

A total of 291 trade associations from every state and Puerto Rico—many of them representing small businesses sent a letter to Congress on Wednesday.

“While this legislation would benefit all merchants, it is small retailers who are calling for swipe fee reform more than any segment of our industry,” the letter said. “Small retailers have the narrowest profit margins and fewest resources and are hit the hardest by continuing unjustified increases in swipe fees.”

A separate letter sent by 1,983 individual merchant companies, including hundreds of small businesses, said the legislation is needed to keep Visa and Mastercard from blocking competition over swipe fees.

“Today, Visa and Mastercard control over 83% of the U.S. credit card market,” the letter said. “They do not have to compete with any other service provider for merchant business. In fact, they bar their competitors from even having a shot at business with banks that issue their cards. This blocking of competition drives up prices for merchants and consumers, harms security and strangles innovation.”

The letters were sent as members of Congress reconvene after their winter break and as sponsors of the CCCA have been promised a Senate vote on the legislation during the current session of Congress.

Swipe fees are up 50 percent since the global pandemic and hit a record $160.7 billion last year, costing the average family over $1,000 a year. Visa and Mastercard each centrally set the swipe fee rates charged by all banks that issue credit cards under their brands and also block transactions from being processed over competing networks that offer lower fees and better security.

The bill would require that cards from the nation’s largest banks be able to be routed over at least one competing network like NYCE, Star or Shazam in addition to Visa or Mastercard’s networks. Banks would choose which networks to enable but merchants would then choose which to use, meaning networks would have to compete over fees, security and service, saving merchants and their customers an estimated $15 billion a year. Financial institutions with less than $100 billion in assets—including all community banks and all but one credit union—would be exempt.

The Merchants Payments Coalition, of which NACS is a member, represents retailers, supermarkets, convenience stores, gasoline stations, online merchants and others fighting for a more competitive and transparent card system that is fair to consumers and merchants.

NACS continues to advocate on behalf of the convenience industry on the issue of swipe fees. You can take action by asking the federal government to lower debit card swipe fees. Learn how companies can  send a letter to Congress and to ensure their voices are heard.