Complete Story
07/25/2023
News from Washington
Credit Card Competition Act
Has your business considered taking credit cards, but then walked away from the thought because swipe fees are too high? OWMA has occasionally heard this from wholesaler members. Because the association also accepts credit cards through our website payment portal as a convenience for members, swipe fees are our concern, too.
Congress is taking steps to address the swipe fee issue through the Credit Card Competition Act, a bill that creates competitive credit card market pricing, which in turn reduces expenses for businesses that accept credit cards.
Visa and Mastercard control 80% of the market and can centrally set swipe fee rates charged by banks that issue their cards. Because of this duopoly, the networks don’t have to compete on price or service, unlike retailers and every other business. When businesses accept a credit card, whichever network that is on the card dictates the fees and terms for the thousands of banks that issue cards. This means businesses have no choice but to incorporate the high swipe fees into their prices.
The Credit Card Competition Act would bring much-needed relief to businesses and consumers by requiring that Visa and Mastercard compete with other networks for both merchant and bank business. It’s estimated that introducing competitive networks will save U.S. consumers and merchants $15 billion annually.
The National Retail Federation is a leading organization in the effort to pass the Credit Card Competition Act. In addition, state associations representing businesses in Ohio, including OWMA, recognize the importance of the bill for all businesses and encourage members to use the VoterVoice grassroots link below to contact your members of Congress. The preloaded message can be customized for your business.
VoterVoice: Credit Card Competition Act
Voter Voice/National Retail Federation