Merchants Support Senator Durbin’s Comments in Favor of the Credit Card Competition Act

Contact: J. Craig Shearman
(202) 257-3678

WASHINGTON, March 21, 2024 – The Merchants Payments Coalition today welcomed comments by Senate Judiciary Committee Chairman Richard Durbin, D-IL, in support of the Credit Card Competition Act.

In remarks on the Senate floor this morning, Sen. Durbin chided the CEOs of Visa, MasterCard, United Airlines and American Airlines for rejecting his invitation to address the issue at an April 9 hearing on swipe fees, saying, “They’re just too darned busy to come and explain the major source of profits for their businesses. They’re too darned busy to come and explain what they’re doing to consumers and families across America.”

The Senator also criticized opponents of the Credit Card Competition Act for spending more than $50 million to spread misinformation about the bill.

Underscoring the need for urgent action on Capitol Hill, the newly released Nilson Report shows that Visa and Mastercard credit card swipe fees in 2023 surpassed the $100 billion mark for the first time in history. Visa and MasterCard accounted for more than $132 billion of $172 billion in debit and credit swipe fees.

“For credit card transactions, interchange fees are much higher [than debit card transactions], in the range of two to three percent," the senator said. "That means if you go to a restaurant and pay $20 for your meal, 40 to 60 cents goes to the bank that issued the credit card that you used to pay for the meal. It may not sound like a lot, but it adds up. It is estimated that businesses paid more than $100 billion in swipe fees on Visa and Mastercard branded cards in 2023 alone. In fact, swipe fees can be small businesses’ second highest cost behind only the cost of labor.”

Swipe fees, on average, are the single biggest expense for merchants aside from labor, and the price tag is far too big for businesses to absorb. The average American family is paying more than $1,000 a year in higher prices due to these anticompetitive fees.

“The bill is expected to save merchants and consumers $15 billion every year in interchange fees,” said Sen. Durbin. “That’s $15 billion a year coming out of the pockets of Wall Street banks and into the pockets of American consumers.”

Sen. Durbin is the sponsor of the Credit Card Competition Act along with Senators Josh Hawley, R-MO; Roger Marshall, R-KS; Jack Reed, D-RI; Peter Welch, D-VT, and J.D. Vance, R-Ohio.

Visa and Mastercard – which control 80 percent of the market – each centrally set the swipe fees charged by banks that issue cards under their brands, and also block transactions from being processed over other networks that could do the job with lower fees and better security.

The legislation would require banks with at least $100 billion in assets to enable cards they issue to be processed over at least two unaffiliated networks – Visa or Mastercard plus a competitor like NYCE, Star or Shazam. 

Banks would choose which networks to enable but merchants would then choose which to use, resulting in competition over fees, security and service that is expected to save merchants and consumers over $15 billion a year. Rewards would not be affected, security would be improved, consumers would still use the same cards, and community banks and all but one credit union would be exempt.

About MPC
The Merchants Payments Coalition 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. Follow MPC on Twitter, Facebook or LinkedIn for the latest on swipe fees.