Coalition Intensifying Lobbying on Interchange Bill

With similar names, it’s difficult to sort out who stands for what.

David Baumann


Nov 20



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David Baumann

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David Baumann

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Credit Card Interchange

Although gridlock seems to have stalled virtually everything on Capitol Hill, lobbying on credit card interchange legislation is intensifying once again, with new and expanded coalitions on either side of the issue having been recently announced.

And the names of the various groups are close enough that it is easy to confuse which one represents which position.

The “Lower Credit Card Fee Coalition” consists of merchant, consumer and progressive groups pushing the legislation introduced by Sens. Richard Durbin, D-Ill., and Roger Marshall, R-Ka. It also includes the Merchants Payments Coalition, Americans for Financial Reform, the International Brotherhood of Teamsters and the Service Employees International Union. The Merchants Payments Coalition also includes retailers, supermarkets, convenience stores and other similar businesses.

The legislation they are pushing, S. 1838, would require the Federal Reserve to issue rules that would ensure that large credit unions and banks that currently use the four-party card processing system be required to use at least one affiliated network in addition to Visa and Mastercard.

On the other side of the issue, the Electronic Payments Coalition recently announced its expanded group, which has included credit union and banking trade groups. That coalition now is being joined by conservative organizations and several other labor unions.

The senators are trying to attach their legislation to any must-pass measures, including the annual defense authorization bill and various appropriations bills. However, House Republicans have been clear about their opposition to it.

New Coalition

The new group, the Lower Credit Card Fee Coalition, is pushing for passage of the bill and contends that interchange fees are costing consumers and small businesses billions of dollars each year. The group argues that injecting competition into the credit card processing business would force companies to lower their swipe fees.

“Merchants have no way to negotiate rates and have no choice but to accept the rates Visa and Mastercard set,” the coalition states on its website. “These fees are then passed onto consumers.”  

The coalition noted that the legislation would exempt credit card-issuing financial institutions with less than $100 billion in assets from having to provide multiple payment networks on their cards. The group said this means that every credit union in the country, with the exception of one, would not have to comply with the requirement. That one credit union is Navy Federal Credit Union.

The group goes on to urge visitors to its website to contact their lawmakers and ask them to support the legislation.  

Electronic Payments Coalition

It is hard to miss advertising from opponents of the Durbin-Marshall plan. The group has advertised everywhere from digital ads in the ultra-conservative Breitbart News to billboards in the nation’s airports.

The coalition boasts that its membership includes 175 organizations.

“Local credit unions and community banks play an essential role in serving small businesses and hardworking families across the country,” the coalition states on its website. “So when EVERY credit union and community bank in America is opposed to the Durbin-Marshall interchange bill… Congress should pay attention.”

The group’s website goes on to contend that while interchange legislation dealing with debit cards supposedly “exempted community banks and credit unions, data from the Federal Reserve clearly show that, following the amendment’s passage, interchange revenue fell for these entities in real terms. The same thing will happen if proposed credit card routing mandates are enacted into law.”

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