Wall Street banks significantly profit from credit card swipes due to the dominance of two companies controlling 80% of the market. They dictate fees and terms, forcing businesses to pay non-negotiable fees or pass costs to consumers. These big banks are pushing for even higher swipe fees, which are especially burdensome for smaller businesses amid inflation.
To address this issue, there’s a proposed bipartisan Credit Card Competition Act, aiming to introduce competition by requiring two processing networks on each card. This could potentially save $15 billion for businesses yearly. A survey done by the Merchants Payments Coalition found that over 65% of those interviewed support this act.
Congress is urged to prioritize Main Street interests over Wall Street profits, especially as Visa and Mastercard plan to increase fees. Swipe fees have more than doubled in a decade, significantly impacting merchants and consumer prices. In these challenging economic times, addressing these issues becomes increasingly important.
