American Families at Risk from Dangerous Durbin-Marshall Credit Card Bill

The following content is sponsored by the Electronic Payments Coalition. American families are living in unprecedented financial times, with prices soaring to never-before-seen heights and inflation continuing to be a stubborn driver of costs. Even simple necessities have become unaffordable. But while you and your family sit around the dining room table and draw up a
American Families at Risk from Dangerous Durbin-Marshall Credit Card Bill

The following content is sponsored by the  Electronic Payments Coalition.

American families are living in unprecedented financial times, with prices soaring to never-before-seen heights and inflation continuing to be a stubborn driver of costs. Even simple necessities have become unaffordable. But while you and your family sit around the dining room table and draw up a tight budget for groceries and back-to-school supplies, retailers like Amazon, Walmart, and Target continue to line their own pockets at your expense.

And who is helping them? None other than Senators Dick Durbin (D-IL) and Roger Marshall (R-KY), who have been working tirelessly to pass their proposed  credit card legislation – a bill that would place government mandates on how credit card transactions are processed.

These mandates would alter the current system by allowing retailers to route their establishment’s credit card transactions through cheaper, untested networks. Pushing these mandates would benefit Durbin and Marshall’s megastore friends, who stand to profit even further, all while they refuse to pass savings along to their loyal customers.

Unfortunately, this proposed change comes at the expense of everyday Americans, as banks often use interchange from card transactions to fund loyalty and rewards programs and bolster consumer data privacy protection measures.

And this isn’t the first time Sen. Durbin’s legislation has led consumers to pay the price. In 2010, Congress passed the Durbin Amendment, requiring the Federal Reserve to cap interchange for debit card purchases, allowing billions of dollars to be placed into the hands of large corporate retailers. While retailers promised consumers would see these savings returned to them, a study from the Federal Reserve Bank of Richmond  showed that more than 98 percent of businesses either raised or kept their prices the same, despite the interchange adjustment. Another study from the University of Chicago  found that families lost roughly $25 billion after the 2010 Durbin Amendment was enacted.

The Federal Trade Commission (FTC) even  released a report earlier this year that highlighted how grocery conglomerates exploited the COVID-19 pandemic to inflate prices of essential items and boost revenue profits.

According to the report’s findings, retail grocery stores such as Kroger, Walmart, and Amazon saw revenues rise to more than 6 percent above spending costs in 2021 and over 7 percent in 2023. This resulted in a “substantially higher” increase in profit compared to their previous peak profit of 5.6 percent in 2015. The FTC stated that the findings “cast doubt on assertions that rising prices at the grocery store are simply moving in lockstep with retailers’ own rising costs.”

These retailers chose to increase prices on customers, despite being well aware of the financial difficulties people around the world were experiencing at the time. Where will the exploitation of American families and consumers stop?

Durbin’s credit card bill will only serve as another blow to already struggling Americans, further demonstrating how these large corporate megastores will stop at nothing to make money, even if it hurts you and your family. We’ve seen Durbin do this before – it’s time we break the harmful cycle and stop allowing American families to pay the price.

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