New Campaign Highlights “Ill-Conceived,” “Unlawful’ Nature & Lopsided Benefits of Illinois Card Law

If the law goes into effect, the largest corporate mega-stores will receive a windfall while the current payment system is upended for small businesses

As the legal battle over a new Illinois credit and debit card processing law continues in federal court, the Electronic Payments Coalition this week launched a statewide, seven-figure ad buy highlighting the credit card chaos the law would bring. The new ad campaign draws heavily from legal opposition filed by federal regulators to the law as well as a new study showing the nation’s largest corporate mega-stores will be the largest beneficiary of the law. 

Earlier this month, the Office of the Comptroller of the Currency (OCC) filed an amicus brief in support of the case the Illinois Bankers Association and Illinois Credit Union League filed opposing the new law. The OCC, an independent federal regulator tasked with ensuring banks operate in a safe and sound manner, said the new Illinois law is an “ill-conceived, highly unusual, and largely unworkable state law that threatens to fragment and disrupt this efficient and effective system.” The OCC continued by saying the new law, which it called unlawful, would result in “higher fees, reduced services, and weakened fraud protection.”

Additionally, EPC’s study finds the largest national corporate mega-stores will be the largest beneficiaries of the law, which carves tax and tip out of credit card interchange. According to the report, 40 of the largest retailers will soak up nearly 40 percent of the estimated $118 million reduction in interchange. The top 10 largest retailers – Amazon, Walmart, Home Depot, Verizon, Apple, AT&T, Costco, CVS, Walgreens, and Kroger – will receive 21.4 percent of the savings. The remainder of the savings to be split among approximately 1.3 million small businesses in Illinois will be a wash after factoring in the operational costs of implementing the new system.

“Left unchecked, the Interchange Fee Prohibition Act will wreak havoc at the register every time people use their credit or debit card in Illinois, creating confusion for consumers and higher costs for small businesses and banks in our state,” said Randy Hultgren, president and CEO of the Illinois Bankers Association. 

“Not only do we need a repeal of the law here in Illinois, but it is imperative that state legislatures across the country understand that this nonsensical policy will be fought with every tool available,” said Tom Kane, president and CEO of the Illinois Credit Union League. 

“Our goal is to ensure every consumer, small business owner, and policymaker in Illinois is aware of the credit card chaos this new law will cause if allowed to go into effect next year,’” said Richard Hunt, Executive Chairman of the Electronic Payments Coalition. “As the OCC, the regulator tasked with ensuring a safe and sound banking system, not only is the law ill-conceived, unworkable, and unlawful, it also creates an inefficient payment system which would have material impact on the ability for businesses to operate in our nation’s economy.” The campaign will include print, digital, television, and radio ads across the state.

Some of the ads are below.

Learn more at www.guardyourcard.com/Illinois.