Durbin and Welch to Visa and Mastercard: Call off Swipe Fee Increase While Small Businesses and Consumers are Hurting During Pandemic
WASHINGTON – U.S. Senate Majority Whip Dick Durbin (D-IL), Chair of the Senate Judiciary Committee, and U.S. Representative Peter Welch (D-VT) today sent a letter to the CEOs of Visa and Mastercard urging the companies not to raise interchange fee rates during the pandemic. Recently, theWall Street Journal reported that Visa and Mastercard are planning for swipe fee rates increases to proceed in April 2021, after delaying them for a year as previously requested by Durbin and Welch. These fee increases reportedly will apply to a variety of types of transactions, including online card payments made to restaurants and grocery stores.
“Just as increased vaccination efforts start to give our Main Street businesses hope for a summer reopening, your companies propose slamming struggling merchants, and by extension consumers, with fee increases. Raising your fees would undermine efforts to help the economy recover and further reduce Americans’ purchasing power,” wrote Durbin and Welch. “We urge you to call off these planned fee increases. Our nation is still reeling from the ongoing pandemic. And your fee rates are more than high enough already. This is not the time to take advantage of your position to squeeze more dollars out of your fellow Americans.”
Full text of the letter is available here and below:
March 3, 2020
Dear Mr. Kelly and Mr. Miebach:
On March 26, 2020, we wrote your companies to urge to you call off your plans to raise swipe fee rates during this pandemic. Commendably, you did postpone those fee increases. However, it has now been publicly reported that Visa and Mastercard are again preparing to significantly raise many of the swipe fee rates you charge for card transactions. This is a mistake.
For the sake of consumers and small businesses, we again urge you: don’t do it.
Over the past year, the COVID-19 pandemic and economic disruption have hit American consumers and small businesses hard. Tens of thousands of small businesses, the backbone of our nation’s economy, have permanently closed. Many businesses that are left, according to the February 24 Wall Street Journal article “Covid-19 Shopping Makes Card Fees a Bigger Burden for Merchants,” have only stayed afloat through online purchases. But your proposed fee increases would disproportionally affect online transactions.
Millions of Americans are unemployed, unsure of how they will pay the bills or put food on the table. Yet several of your proposed fee increases, according to the Wall Street Journal, would target supermarket and restaurant transactions as many more of those purchases have moved online.
Just as increased vaccination efforts start to give our Main Street businesses hope for a summer reopening, your companies propose slamming struggling merchants, and by extension consumers, with fee increases. Raising your fees would undermine efforts to help the economy recover and further reduce Americans’ purchasing power.
We urge you to call off these planned fee increases. Our nation is still reeling from the ongoing pandemic. And your fee rates are more than high enough already. This is not the time to take advantage of your position to squeeze more dollars out of your fellow Americans.
Sincerely,
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