Trade Groups & Companies Unite in Call for Swipe Fee Changes

WASHINGTON, D.C. — Almost 2,000 companies and nearly 300 trade associations organized through the Merchants Payments Coalition (MPC) called on Congress to pass the Credit Card Competition Act as lawmakers returned to Washington, D.C., this week.

The bipartisan bill would assert that retailers in certain cases have the right to route payments through networks unaffiliated by the credit card providers, potentially lowering the fees they have to pay.

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

"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 said the legislation is needed to keep Visa and Mastercard from blocking competition over swipe fees.

The letters are the latest lobbying effort by small and independent businesses to whip up support for swipe fee reform. They join a growing number of voices that have been speaking out about the issue since a similar bill failed to garner a committee vote in the Senate in 2022.

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

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, which could save merchants and their customers an estimated $15 billion a year. 

The MPC stated that sponsors of the bill have been promised a Senate vote on the legislation during the current congressional session.