Hawkeye Reporter

The Electronic Payments Coalition has expressed concerns regarding the Durbin-Marshall Credit Card Bill, asserting that it does not benefit consumers or small businesses. The coalition cited a Congressional Research Service report in its announcement made on the social media platform X.

According to Congress.gov, the Credit Card Competition Act, introduced by Senators Dick Durbin and Roger Marshall, mandates credit card issuers to facilitate transaction routing through at least two unaffiliated networks. Proponents argue that this measure promotes competition and reduces fees for merchants. However, critics caution that the policy might diminish rewards and adversely affect small businesses.

A study commissioned by the Electronic Payments Coalition estimates that the Credit Card Competition Act could result in a $227 billion loss in GDP and 156,000 jobs over five years for the U.S. economy. The analysis, conducted by Cornerstone Advisors, warns of potential reductions in cardholder rewards and increased fraud risks. It also identifies possible declines in travel, tourism, and small business spending.

The Federal Reserve reports that small issuers, including credit unions in states like Iowa, may face higher costs and reduced interchange revenue under proposed routing mandates. Public comments included in the report warned that credit unions serving rural and underserved areas might cut services. The Federal Reserve noted these institutions often rely on interchange fees to sustain operations and provide affordable financial products.

The Electronic Payments Coalition (EPC) is an advocacy group representing credit unions, community banks, and payment card networks. EPC focuses on preserving the value, innovation, and security of electronic payments for both consumers and businesses. The coalition engages in policy discussions and public education concerning interchange fees and payment system regulations.