Bills introduced in the U.S. Senate and the House of Representatives aim to reduce interchange fees for retailers on the backs of consumers and card issuers. S. 1838 and H.R. 3881, the Credit Card Competition Act of 2023, would require covered card issuers, defined as card issuer with over $100 billion in assets, to include at least two unaffiliated networks on which an electronic credit transaction can be processed. The two affiliated networks cannot be the networks holding the two largest market shares and prohibit covered card issuers or networks limiting the ability of merchants to route transactions over any network that may process such transactions. It prohibits the use of authentication, tokenization, or other 
security technology that would limit the ability of retailers to rout credit transactions over any network. It would also prohibit any penalty or disadvantage for choosing to route transactions over certain networks or for failing to ensure a certain number or aggregate dollar amount are routed through a particular network.
CUNA and NAFCU have both indicated that despite most credit unions being under $100 billion in assets, all credit unions with card programs will see a cut in interchange revenue if the bills were to pass. CUNA cited that while credit unions were supposedly exempt from the Durbin Amendment in the Dodd-Frank Act, credit unions suffered a 30% decrease in interchange revenue on debit programs. CUNA says that “these proposed restrictions have the same practical effect of distorting the market”. According to CUNA, credit unions could see a 50% cut in interchange revenues if the debit card interchange regulations were extended to credit card transactions and they estimate that 73% of credit unions would have to raise credit card rates, 61% would have to create or raise credit card program fees, and 15% would have to reduce or eliminate their credit card program.
The League and CUNA are urging credit union professionals and volunteers to contact our Nebraska Congressional Delegation and urge them to oppose the Credit Card Competition Act.
