In July, 2022, Senate Majority Whip Dick Durbin (D-IL) and Senator Roger Marshall (R-KS) introduced the bipartisan “The Credit Card Competition Act,” (S.4674) which would ensure retailer choice in payment routing by requiring at least two unaffiliated processors on credit cards, the same process that is used for debit card transactions. Swipe fees remain the second highest operating cost for convenience stores which costs the industry $138 billion.
There are nearly a dozen of independent networks that are equipped to route transactions, but a handful of dominant networks (VISA and Mastercard), have prevented them from competing in the credit card space limiting the choice of network. By allowing retailers a choice of network to handle a transaction, they can reduce costs and pass those savings onto the consumer. Introducing routing competition could save businesses and consumers upwards of $11 billion annually according to payments consulting firm CMSPI.
“With the rising rate of inflation and its impact on motor fuel prices, it’s time for Congress to pass credit card swipe fee reform to reduce costs for small business energy marketers,” said EMA President Rob Underwood.
EMA is a member of the Merchants Payments Coalition (MPC), which represents retailers, supermarkets, restaurants, drug stores, convenience stores, gas stations, online merchants, and other businesses focused on reforming the U.S. payments system to make it more transparent and competitive. MPC firmly believes in opening up the payments market and introducing competition, which in turn would lower costs and drive innovation.