Introduced in June by U.S. Rep. Lance Gooden, R-Texas, the proposal would drive down swipe fees by requiring at least two competing processing networks be enabled for every credit card issued by the nation’s largest banks.
“Two credit card companies control over 80% of the market, and predictably their fees have more than doubled in the past decade,” Williams Knight said in a statement. “This is a David-versus-Goliath story local restaurants live every day. As a practical matter, they must accept credit cards, and yet they have no ability to negotiate lower fees from Visa and Mastercard.”
The CCCA requires banks with more than $100 billion in assets to facilitate a second secure network that locally owned small businesses can choose to process credit card transactions. This “dual routing” requirement already exists for debit cards. In addition to driving down swipe fees and saving Texas restaurants millions of dollars, the change would improve credit card security and service, Williams Knight added.