Bipartisan Bill to Mandate Two Credit Card Processing Networks Gains Momentum, Targeting $15 Billion in Swipe Fees

Every time a consumer taps a credit card to pay for groceries, gas, or a morning coffee, the merchant quietly pays a hidden fee of 2% to 3% to process the transaction. This interchange fee, while invisible to the shopper at the checkout counter, represents a massive structural cost that ultimately inflates the retail price of everyday goods across the economy. Now, a renewed bipartisan legislative push in Washington is attempting to fundamentally rewrite the plumbing of the United States payments system, aiming to bring those processing costs down by forcing the industry's biggest players to compete for merchant traffic.[1]

The Credit Card Competition Act (CCCA), reintroduced in the 119th Congress by Senators Roger Marshall (R-KS) and Dick Durbin (D-IL), has gained significant momentum in recent weeks following a public endorsement from President Donald Trump. The legislation takes direct aim at the estimated $198 billion that American businesses paid in swipe fees last year—a figure that has surged by 80% since the pandemic. By targeting the core revenue engine of the payments sector, the bill seeks to break the entrenched dominance of the two largest networks and reshape how money moves between consumers, banks, and retailers.[2]

The central mechanism of the proposed legislation is straightforward but highly disruptive to the current financial ecosystem: it requires credit card issuers with more than $100 billion in assets to enable at least two unaffiliated payment networks on every credit card they issue. Under the current system, most credit cards are locked into a single routing network—typically Visa or Mastercard, which together control more than 80% of the transaction market. This exclusivity means that when a consumer presents a card, the merchant has no choice but to route the payment through that specific network and pay whatever rate it dictates.[1][3]

By forcing large banks to offer a secondary, unaffiliated routing option on every card, the legislation aims to create a competitive bidding environment for merchant transaction traffic. Retailers would be empowered to choose the network that offers the lowest processing rate or the most robust security features for each individual swipe. This structural shift mirrors the routing choice that already exists for debit card transactions, which were similarly regulated under the Durbin Amendment following the 2008 financial crisis, theoretically allowing market forces to drive down costs.[2][3]

Proponents of the bill, led by groups like the Merchants Payments Coalition and the National Retail Federation, estimate that introducing this network competition could save American businesses and consumers between $15 billion and $16.4 billion annually. Small business advocates emphasize that swipe fees are frequently their second-highest operating expense, trailing only payroll, and represent an uncontrollable cost that eats directly into their margins. They argue that without federal intervention, independent retailers have absolutely no leverage to negotiate against the periodic price hikes imposed by the dominant card networks.[3]

However, the legislation faces a formidable and well-funded opposition campaign from the banking and credit union industries, with industry spending against the measure reportedly reaching $200 million. Financial institutions argue that interchange fees are not simply pure profit, but rather the essential funding mechanism for the robust fraud prevention, chargeback resolution, and cybersecurity infrastructure that protects consumers from identity theft. They warn that forcing transactions onto smaller, alternative networks could compromise data security and leave the broader financial system more vulnerable to sophisticated cyberattacks.[3]

The banking lobby also cautions that squeezing interchange revenue will have an immediate and negative impact on the consumer experience. Because swipe fees heavily subsidize the popular cash-back, airline miles, and travel rewards programs that millions of Americans rely on, a sharp reduction in network revenue could force card issuers to drastically dilute or eliminate those perks entirely. Opponents point to the aftermath of debit card regulations, arguing that price controls ultimately resulted in the end of free checking accounts and debit rewards for the average banking customer.[1][3]

Despite the fierce lobbying battle and the high stakes for the financial sector, the bill's bipartisan sponsorship—which recently expanded to include Senators Cynthia Lummis (R-WY) and Bernie Moreno (R-OH)—combined with White House backing makes it the most serious legislative challenge to the current payment structure in years. If the measure successfully navigates Congress, the Federal Reserve would still need to undergo a lengthy and complex rulemaking process before the dual-network mandate takes effect. Until then, the battle over who ultimately pays for the convenience of plastic will continue to dominate financial policy discussions in Washington.[3]