Fool Me Once… Big-Box Retail and Merchant Groups Are Pushing the Same Lies About The “Benefits” of Credit Card Routing Mandates
Retail and merchant trade groups are at it again…
Back in 2010, lobbyists for big-retail and merchant groups promised that if Congress enacted routing mandates on debit card transactions, then they would lower prices for consumers:
“There’s no doubt the majority of it (the savings from the Durbin Amendment) would go through in consumer savings.”–Douglas Kantor on Behalf of The National Association of Convenience Stores (NACS) June 10, 2010
Congress gave mega-retailers what they wanted, passing the Durbin Amendment in 2010 which enacted price caps and routing mandates on debit card transactions.
And did these retailers hold up their end of the bargain and lower prices for consumers?
When the Federal Reserve Bank of Richmond examined retailers’ response to the Durbin Amendment, it found that:
- 77% of merchants did not change their prices
- 1% of merchants lowered their prices
- 22% of merchants INCREASED prices
Since 2010, mega-retailers like Amazon and Wal-Mart have pocketed more than $106,000,000,000 that was supposed to be returned to consumers.
Fast forward to today, and now these same lobbyists big-retail and merchant groups are promising the same lies if Congress passes new credit card routing mandates:
“Our estimate is that [credit card routing mandates] ought to be about $11 billion in savings overall…You ought to see a vast majority of that going to consumers.”–Douglas Kantor on Behalf of The National Association Of Convenience Stores (NACS) July 27, 2022
Don’t Let Big-Box Retailers Fool Congress Again:
Proposed credit card routing legislation is a multibillion-dollar corporate welfare scheme for big-box retailers that will lead to less secure, less innovative, and higher-risk transactions for American consumers.
For more information, check out EPC’s Resources on Credit Routing:
EPC Explainer Video: Credit Routing Mandates and Why They Hurt Consumers
Myth vs. Fact: Setting the Record Straight on Credit and Debit Routing