Swipe fees are most merchants’ highest costs after labor.
Consumers have a trust problem with credit card companies when it comes to certain issues.
Less than one-quarter (21%) of consumers believe that credit card companies are honest and trustworthy when they advocate before Congress on the fees they charge retailers to accept their cards, according to a survey released by the National Retail Federation.
This is in addition to previous NRF surveys that found 81% of consumers support federal legislation that would allow for greater competition to lower credit card fees for small businesses. Also, 73% of consumers say they trust small businesses over large institutional banks when it comes to advocating for policies that impact consumers. (The number goes up to 77% among women versus 68% among men.)
The Credit Card Competition Act, which is currently under consideration before Congress, would require that there be at least two competing processing networks enabled on each card, potentially saving American businesses and consumers an estimated $15 billion per year.
“Rising credit card swipe fees are hidden taxes on small businesses and consumers,” stated NRF senior VP of government relations David French. “It’s time for Congress to pass the Credit Card Competition Act.”
Swipe fees, which are most merchants’ highest costs after labor, drive up prices paid by consumers by more than $1,000 a year for the average family, according to the NRF. U.S. retailers and merchants pay the highest swipe fees in the industrialized world — $126.4 billion in swipe fees were paid by businesses for credit card transactions in 2022, a 20% increase from the previous year.