NATIONAL REPORT — The heads of multiple major payment companies are teaming up to form the Payments Leadership Council (PLC). Members include the CEOs of American Express, Discover Financial Services, FIS, Fiserv, Global Payments, Mastercard and Visa.
Raj Date will serve as founding director. He previously served as deputy director of the Consumer Financial Protection Bureau and held multiple roles at companies including Capital One and Deutsche Bank.
The PLC's goal, according to its launch announcement, is to bring the CEOs together to share their unique insights on the innovations that have enabled leadership in global commerce and economic growth in order to promote effective public policies that are responsive to the current and future challenges facing the U.S. economy.
"As America recovers from the impact of COVID-19, it is more important than ever to have an efficient and effective payments system that works for everyone," council members said in a joint statement. "The Payments Leadership Council recognizes the unique and critical role the payments industry will play in the country’s economic recovery. We will work with policymakers to promote inclusive growth, protect consumers, foster inclusion, cultivate innovation, and support a dynamic ecosystem for payments."
The PLC agenda includes the payment industry's public policy response to multiple issues, including a potential $1.1 billion increase in credit card processing fees that was previously delayed due to the COVID-19 pandemic, reported the San Francisco Business Times.
Sen. Dick Durbin (D-Illinois) and Rep. Peter Welch (D-Vermont) recently wrote to the CEOs of Visa and Mastercard urging them not to enact the scheduled fee increase.
"It has now been publicly reported that Visa and Mastercard are again preparing to significantly raise many of the swipe fee rates you charge for card transactions. It is a mistake," the legislators wrote in their letter. "For the sake of consumers and small businesses, we again urge you: don't do it."
In response to the letter, Mastercard noted that the plans it first announced in 2020 include adjusting some interchange fees for the first time in 10 years as part of a plan made prior to the pandemic and delayed by a year. This includes increases and decreases for all small-ticket transactions and decreases for categories such as car rentals, lodging, daycare and certain restaurants.
"We recognize the challenges merchants are facing and will continue to be thoughtful about the timing of implementation," Mastercard stated.
The planned fee hike for credit cards is expected to have an especially notable impact on e-commerce transactions, as online shopping has jumped during the pandemic. According to payment companies, interchange fees for credit card acceptance help to pay for infrastructure and other costs, San Francisco Business Times reported.