A pair of U.S. senators are preparing a bill that would give merchants the ability to process many Mastercard and Visa credit cards over different networks.
As The Wall Street Journal reported Wednesday (July 27), the legislation could be introduced this week and is designed to foster more competition in American credit card networks, which have long been dominated by Visa and Mastercard.
Sen. Dick Durbin, D-Ill., and Sen. Roger Marshall, R-Kan., are expected to introduce the bill, which, according to Marshall, banks and card networks have lobbied against.
He told the Journal he decided to back the legislation after hearing from a growing number of merchants about the burden rising card fees have placed on smaller businesses.
Durbin led the effort for a similar bill dealing with debit cards in 2010. That rule — an amendment to the Dodd-Frank law — requires that merchants have the ability to pick from at least two unaffiliated card networks when routing transactions.
Read more: Four Lawmakers Ask Visa, Mastercard to Scrap Plans to Raise Fees to Merchants
In April, Durbin and Marshall were part of a bipartisan group of lawmakers who wrote to Visa and Mastercard, asking them to abandon their plans to increase certain fees, arguing that merchants would pass those fees onto consumers.
Rising costs are “the last thing American families deserve right now,” said the letter, signed by Durbin, Marshall, and Rep. Peter Welch, D-Vt., and Rep. Beth Van Duyne, R-Texas.
A few days later, the National Retail Federation (NRF) joined the lawmakers in asking the card companies to reconsider the fee hike.
See also: NRF: Mastercard, Visa Should Cancel Credit Card Swipe Fee Increases
“American consumers are struggling under the worst inflation in four decades, and these increases would only make the situation worse,” said NRF Vice President for Government Relations, Banking and Financial Services Leon Buck. “… [Banks and credit card networks are] going to see billions of dollars more in revenue this year even if rates stay the same.”
Visa and Mastercard have said the fees help cover innovation and security measures.
“Electronic payments play a critical role every day and have proven even more valuable since the start of the pandemic,” a Mastercard spokesman said at the time. “And that’s why we’re seeing merchants encouraging their customers to use electronic forms of payment due to the significant value that they receive in return — a safe, convenient experience and a guaranteed payment.”
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