WASHINGTON–The Merchants Payments Coalition was back with another holiday-related metaphor to illustrate what it says is the cost to consumers of rising “swipe” fees charged retailers by banks and credit card networks.
During the Easter holiday, the MPC said those fees cost the average consumer the equivalent of a dozen eggs and potentially total over half a billion dollars nationwide.
‘Hand in the Basket’
“The card industry will be putting its hand in the Easter basket again this year as rising swipe fees contribute to the cost of everything from Peeps to chocolate bunnies,” said MPC Executive Committee member and National Association of Convenience Stores General Counsel Doug Kantor, in a statement. “These fees make inflation even worse at a time when parents and the Easter Bunny can least afford it. And the problem won’t end when Easter is over because swipe fees drive up prices for consumers all year long. The card industry refuses to stop price-fixing these fees and compete, so it’s time for Congress to act. If children can compete at an Easter egg hunt, why can’t card networks compete when it comes to setting swipe fees?”
$24 Billion to Be Spent
Ahead of the holiday, the organization pointed to the National Retail Federation’s annual survey estimates that consumers would spend an average $192.01 on Easter-related items this year for a total of $24 billion.
“Based on the 2.24% average swipe fee for Visa and Mastercard credit cards, $4.30 per shopper will go to banks and card networks rather than the merchant when customers pay by credit card,” said the MPC. “That’s just above the $4.21 average price for a dozen eggs, and also more than a typical $3.74 package of Easter egg dye, a $3.49 hollow chocolate bunny, a $3 bamboo Easter basket or three $1.36 10-count packs of Peeps.”
Renewed Call for Legislation
The MPC again stated that credit and debit card swipe fees have more than doubled over the past decade and soared 17% during 2022 to a record $160.7 billion, according to the Nilson report.
The organization again called on Sens. Richard Durbin (D-IL) and Roger Marshall (R-KS) to reintroduce their Credit Card Competition Act, which credit unions oppose.
That legislation, first introduced last year, would require that banks with over $100 billion in assets enable credit cards to be processed over at least two unaffiliated networks. Under the bill, one of those could still be Visa or Mastercard but the other would be a competing network such as NYCE, Star or Shazam. Banks would choose which two to enable but merchants would choose which to use, forcing networks to compete over fees, security and service.
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