Credit Card Competition Act

 There’s a possible vote coming up by the end of the year about the Credit Card Competition Act . We’ll see if it passes BUT what is it and how does it affect consumers? The CCC Act is a bipartisan bill. It takes aim at the following: Merchant fees: Any merchant who accepts credit cards has to pay a fee to the credit card network every time customers swipe. These fees cost merchants $126.35 billion in 2022. Of course, accepting credit cards is…pretty much mandatory in 2023, which leaves merchants at the mercy of the credit card companies. Credit card processing networks: Visa and Mastercard control more than 80% of the credit card processing network market. As a duopoly, the two companies can pretty much charge whatever kind of fees they’d like. The CCC Act would change things up, forcing the financial institutions to enable at least two processing networks for their cards—and one of those networks must fall outside of the Visa/Mastercard duopoly. More processing networks for credit cards means more competition among the major credit card networks, which hopefully means lower fees for merchants. The American Bankers Association “strongly opposes” the bill, calling it a “regressive bill that takes from consumers, community financial institutions, and small businesses and gives to the most profitable global retailers and biggest grocery chains. Opponents also cite the Durbin Amendment, which limited how much issuers could charge merchants on debit card transactions as part of the 2010 Dodd–Frank Act. There’s concerns that credit card rewards would be affected too. But others say credit card companies will still offer rewards to gain new customers. Legislators won’t officially vote on the CCC Act until later this year at the earliest. In the meantime, it’s worth digging into the current nature of the credit card processing market to see why some senators think this move is a good idea. yoursafemoneyshow.com.