A major effort is underway by big banks and credit card companies to prevent economic relief from being provided to businesses and consumers. North Carolina’s senators must resist succumbing to the pressures of Wall Street giants and, instead, champion the cause of Main Street by supporting the Credit Card Competition Act.
Like much of the nation, North Carolina is not immune to big banks’ pervasive influence. These financial behemoths, with their deep pockets and extensive lobbying power, have historically wielded considerable influence over shaping policies that favor their interests at the expense of small businesses and local economies.
The Credit Card Competition Act presents a real opportunity for our federal delegation, in particular Sens. Ted Budd (R-NC) and Thom Tillis (R-NC), to stand on the side of Main Street.
At its core, this legislation aims to lower swipe fees for businesses by injecting competition into the payments marketplace and providing businesses with a second routing option when processing credit card transactions. Currently, merchants only have one network option and are forced to pay the swipe fees set predominately by Visa and Mastercard, given that they control over 80% of the market. And since the big banks who collect these fees get a cut, there is no incentive to negotiate lower fees as Wall Street rakes in record profits off the hard-earned revenue of businesses and consumers in our communities.
Banks and credit card companies, who are afraid of increased competition interrupting their price-fixing scheme, have launched a multi-million-dollar media campaign to sow confusion about the CCCA. For example, ads across the country have claimed that this bill would eliminate credit card rewards points as we know it — a complete lie. The CCCA allows credit card transactions to be processed over at least two competing networks. The decision on rewards lies solely with the banks that issue the cards, not the networks, and the notion of losing rewards is nothing more than a scare tactic to mislead consumers.
This legislation aims to lower swipe fees for businesses by injecting competition into the payments marketplace and providing businesses with a second routing option when processing credit card transactions.
Senators representing North Carolina must recognize that siding with Wall Street in opposition to the CCCA would be a direct betrayal of the state’s vast array of small businesses and families. From the local charity accepting donations via credit card to the family-owned market, the burden of swipe fees is spreading and growing more significant. Just this year, Visa and Mastercard scheduled another increase of swipe fees to the tune of more than half a billion dollars.
The status quo is simply not sustainable — we need congressional action. The consequences of doing nothing are far-reaching, impacting industries across the board. Ever-rising swipe fees wreak havoc on small businesses, stymie growth, increase consumer costs, and ultimately strip funds from our communities. By standing in the way of the Credit Card Competition Act becoming law, senators risk perpetuating this cycle of allowing big banks to maintain an unjust stranglehold on the financial well-being of our local businesses.
By supporting the Credit Card Competition Act, they can send a clear message that they stand with Main Street over Wall Street, that they prioritize the prosperity of local businesses, and that they are committed to fostering an environment where competition thrives, benefiting consumers and entrepreneurs alike.
Bobby Hurst lives in Fayetteville.