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New Legislation Leaves Consumers, Small Businesses Footing the Bill

The following content is electronic payment federation.

Supporters of the new bill in Congress like to tout it as being for small businesses and the American people. But in reality, that’s not what they’re benefiting from at all from the new credit card mandates they’re pushing in the name of increased competition.

In fact, Sen. Dick Durbin and Sen. Roger Marshall’s most recent credit card bill obligations are line the pocket The largest corporate megastore.

They argue that the bill would fundamentally change the current safe, secure, hassle-free credit card system and increase competition by allowing credit cards to be routed over untested alternative networks. are doing. The theory is that these untested networks will be cheaper and the savings will be passed on to consumers.

However, according to a recent report from the University of Miami, revealed The disturbing reality of the consequences of this law. While small businesses will bear the brunt of the proposed changes, giant stores like Walmart and Target are reaping immense benefits.

The study found that the top 100 U.S. retailers could earn nearly $3 billion in profits, with the top five alone earning $1.2 billion. Companies with less than his $500 million in sales probably won’t see any savings from this big change.

Durbin and Marshall may say the bill will benefit small businesses and communities, but the facts of the report are clear. America’s largest retailers will effectively receive about $2.9 billion in transfers from issuers and cardholders affected by the law. In contrast, small businesses save much less, if at all, despite their existing competitive disadvantages to larger businesses.

The report also found that small businesses are likely to lose their own benefits, as they receive about $12 billion in credit card benefits if they shop on credit themselves. .

Consumers will also lose benefits. The costs associated with participating in credit rewards programs will rise, threatening the existence of airline reward points and credit card rewards programs as a whole. The loss of these rewards would make it more difficult for Americans to buy food and other necessities.

And this report is by no means the only report of its kind. Independent Congressional Research Service (CRS) echoed Many of the University of Miami’s findings question the benefits for small businesses and consumers, raising concerns about the potential for increased fraud and consumer safety. Countless studies have been conducted on similar mandates promoted by Senator Durbin in 2010. Government Accountability Office (GAO) I found that. The economic impact of these changes to debit cards resulted in the overall loss of debit rewards programs and free checking accounts, hitting low-income Americans the hardest.2022 report from researchers at the University of Pennsylvania and Georgetown University Indicated The Durbin amendment “led to increased checking account fees paid by consumers,” he said.

Despite overwhelming evidence that consumers are the ones paying the price, Sen. Durbin and the megastores are rebelling again. This time, we need Congress to listen to American consumers and numerous studies.

We must use our voices and votes to reject Durbin Marshall’s false promises and demand real solutions that empower small businesses and promote economic opportunity for all. not.

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