New Progressive Policy Institute Report Shows The Credit Card Competition Act Will Endanger the Security of Consumer Data

September 19, 2023 | Electronic Payments Coalition

Report investigates the pitfalls of the Durbin Amendment and delves into the dangers of capping credit card interchange fees

WASHINGTON D.C. – On September 13, the Progressive Policy Institute (PPI) released a report showing how the Credit Card Competition Act of 2023 (CCCA) will negatively affect American consumers by threatening the safety of their data, limiting their card rewards and costing them more money out of pocket overall.

The report delves into the consequences felt by consumers from the 2010 Durbin Amendment, which capped debit card interchange fees. The research highlights how many promises made through the passage of the Durbin Amendment were left unfulfilled – consumers paid more out of pocket as merchants did not lower costs, checking account fees were increased and rewards offerings were limited.

The newly reintroduced Credit Card Competition Act aims to achieve many of the same objectives as the Durbin Amendment did with debit cards, instead with credit. PPI’s study echoes many recent claims that the passage of this bill would cause devastating consumer loss, much like its predecessor.

The CCCA, referred to by many as Durbin 2.0, would have negative implications for consumer data security. PPI’s study explains that under Durbin 2.0, routing decisions will shift from banks and consumers to merchants, leaving banks with little or no control over the routing systems used for credit card transactions. Credit cards are even more vulnerable than debit cards – as they are unsecured loans from banks – and the CCCA would only further these vulnerabilities for consumers worldwide.

“This study proves what we already knew,” says EPC’s Executive Chairman Richard Hunt.

“Consumer data will be less secure and the reward points families use to combat inflation will be put in jeopardy. The real winners here are the largest retailers in the country, who will reap all the benefits. In short, Durbin 2.0 will have the same negative impact on consumers as Durbin 1.0. Congress should not fall for the same broken promises about lower costs again.”

To learn more about PPI’s findings, view the full report HERE or copied below.