Credit card swipe fees, a prominent challenge that circulates the c-store industry often, are once more making headlines with a record number. Swipe fees for credit cards and debit cards combined totaled $187.2 billion in 2024, up from $172 billion in 2023, according to the Nilson Report. The Merchants Payments Coalition (MPC) noted that was up 70% since the pandemic.
The swipe fees were led by Visa and Mastercard, which brings the Credit Card Competition Act into the conversation.
“With no competition to hold them in check, price-fixed swipe fees rise every year and shot up again last year,” said MPC Executive Committee member Christine Pollack, vice president of government relations at FMI — The Food Industry Association — in a statement. “As Main Street small businesses and American families continue to face economic uncertainty, the giant card networks and Wall Street banks continue to take more money out of their pockets every day. These fees contribute to inflation and siphon off money that could be used to hold down prices or invest in local communities. Momentum for swipe fee reform is rapidly growing in Congress, and constituents in every district are calling on lawmakers to stand up for Main Street over Wall Street.”
Visa and Mastercard control over 80% of the U.S. credit card network market. The Credit Card Competition Act would attempt to reduce credit card fees through enhanced credit card competition and choice.
“It would require the largest credit-card issuing financial institutions in the country — those with assets over $100 billion — to enable at least two credit card networks to be used on their credit cards instead of just one, and at least one of those networks
must be a network other than the Visa/Mastercard duopoly,” explained U.S. Senator Dick Durbin on his website.
Sponsors are currently preparing to reintroduce the Credit Card Competition Act, MPC stated.
There are actions that retailers can take in the meantime to help mitigate swipe fees. For instance, unbranded c-stores can negotiate better terms with payment processors, according to Peter Rasmussen, CEO and founder of Convenience & Energy Advisors.
“C-store operators with branded locations should factor in the credit card surcharge in their overall decision of which brand to choose or if they should go unbranded. Unbranded retailers with good terms negotiate a small base fee per transaction with the processor, with pass through rates on the interchange,” he continued.
Still, retailers are of course able to advocate for swipe fee regulations. Time will tell what the outcome will be for the Credit Card Competition Act and swipe fee reform in general.
