Joco Today

U.S. Senator Roger Marshall, M.D., and Senate Majority Whip Dick Durbin (D-IL), lead sponsors of the Credit Card Competition Act, issued a statement following U.S. District Judge Margo Brodie's rejection of the Visa and Mastercard settlement with U.S. merchants to temporarily lower credit interchange rates and cap those rates into 2030.

"We’re pleased Judge Brodie rejected this settlement, which we felt only temporarily provided concessions negotiated by a few lawyers behind closed doors. And we are hopeful that Visa and Mastercard will now negotiate a settlement that truly benefits our merchants and small businesses," the statement read.

"However, the only true solution is to pass our bipartisan, bicameral legislation—the Credit Card Competition Act—to enhance competition between credit card networks and ultimately lower costs for small businesses and consumers. We need to bring real competition to the credit card industry. Our bill ensures that the Visa-Mastercard duopoly ends their price gouging tactics that disproportionately hurt American families and small businesses."

In 2023 alone, businesses paid more than $100 billion in swipe fees on Visa and Mastercard branded cards. For many small businesses, these swipe fees represent their second highest cost after labor.

The Credit Card Competition Act of 2023 aims to enhance competition and choice in the credit card network market, currently dominated by Visa and Mastercard. The bill builds on debit card competition reforms enacted by Congress in 2010, directing the Federal Reserve to ensure that large credit card-issuing banks offer a choice of at least two networks for processing electronic credit transactions. The bill is estimated to save merchants and consumers $15 billion annually.

According to the Federal Reserve, Visa and Mastercard account for nearly 576 million cards or about 83 percent of general-purpose credit cards in circulation. Their market power allows them to impose some of the world's highest fees on U.S. merchants, including interchange fees paid to issuing banks and network fees paid directly to Visa and Mastercard. These costs are ultimately borne by consumers through higher prices for goods and services.