WASHINGTON, DC - Today, members of the Small Business Rising coalition sent a letter to the cosponsors of the Credit Card Competition Act (CCCA) thanking them for their leadership to rein in exorbitant credit card interchange fees – also known as swipe fees. This is a top issue for independent and small business owners across the country, and the coalition is eager to work with Congress to pass this legislation.
Excerpts of the letter are included below and THE FULL LETTER CAN BE VIEWED HERE.
The letter was covered in Politico’s Morning Money.
Dear Senator Durbin, Senator Marshall, Senator Vance, Senator Welch, Congressmember Gooden, Congressmember Lofgren, Congressmember Tiffany, and Congressmember Van Drew:
The below undersigned organizations from Small Business Rising — a coalition of small business membership associations representing more than 250,000 independent businesses — are writing to thank you as the co-sponsors of the recently introduced bipartisan, bicameral Credit Card Competition Act and to underscore the urgency for Congress to pass this legislation.
Concentrated market power is the single biggest threat facing independent businesses, and it has become clear we have a financial system that benefits behemoth corporations at the expense of ordinary people and small businesses. Our coalition partners have identified exorbitant credit card interchange fees – also known as swipe fees – as a top issue undermining their small business members, who report that swipe fees are now their highest expense after payroll, even though Visa and Mastercard add only nominal value to the goods and services these merchants provide. What’s more, swipe fees increase the cost of food and goods for the average American family by $1,000 a year according to 2022 figures from the Consumer Financial Protection Bureau.
Absent competition, Visa controls 60 percent of credit and debit card transactions, while Mastercard accounts for 25 percent. American Express captures most of the rest and leads in certain sub-markets. This means that a large cross-section of American spending is essentially subject to a monopoly tax imposed by two mega-corporations. Consumers and businesses pay more, while Visa and Mastercard reap the surplus and share gains with a small handful of big banks. Just four banks — Chase, Wells Fargo, Citi, and Bank of America — issue about half of all credit cards.
This monopoly rent-seeking disproportionately harms small businesses. While large corporations, such as Amazon and Walmart, have some leverage to negotiate better rates, independent businesses have little choice but to pay whatever the banks and networks demand.
This ‘duopoly’ power must be addressed through legislation like the Credit Card Competition Act, which will prevent Visa and MasterCard from forcing merchants to use their card networks to process payments, resulting in significant fee reductions for small businesses. This legislation is pro-consumer, pro-small business, and should be a top priority in Congress this summer.
Signed by:
Alliance for Pharmacy Compounding
American Booksellers Association
American Independent Business Alliance
American Specialty Toy Retailing Association
Austin Local Business Alliance
Cambridge Local First
Dane Buy Local
Independent Restaurant Coalition
Institute for Local Self-Reliance
The Local Crowd Monadnock
Local First Arizona
Local First, La Plata
Local Return
Louisville Independent Business Alliance
Love Live Local Inc.
Lowcountry Local First
Main Street Alliance
National Bicycle Dealers Association
National Community Pharmacists Association
National Grocers Association
National Ski & Snowboard Retailers Association
National Sporting Goods Association
New Atlantic Independent Booksellers Association
North American Hardware and Paint Association
North American Marine Alliance
People First Economy
Shop Local Raleigh
Spokane Independent Metro Business Alliance
StayLocal an initiative of Urban Conservancy
Workplace Solutions Association
World Pet Association
Running Industry Association
About Small Business Rising
Small Business Rising, a coalition of nearly 40 organizations representing more than 250,000 independent businesses, formed in 2021 to urge policymakers to rein in monopoly power and inject fairness into a system that has long left small businesses at a competitive disadvantage. The Hill described the coalition as "playing a pivotal role in high-profile debates over antitrust," and helping "sway lawmakers to advance legislation to break up the largest tech companies through the House Judiciary Committee.”
Together, members of the coalition and small business voices have calling for Congress to stop tech monopolies, like Amazon, from cornering the online market by breaking them up and regulating them, for states to pass robust antitrust laws, and for Federal regulators to use their enforcement authorities to block dominant corporations from engaging in abusive tactics. For media inquiries, please email media[at]smallbusinessrising[dot]net | SmallBusinessRising.net.