The Brewers Association (BA), along with over 200 national and state trade associations, sent a letter to Congress asking them to support S. 1838/H.R. 3881, the Credit Card Competition Act, bipartisan legislation lead by Senators Roger Marshall (R-Kan.) and Dick Durbin (D-Ill.) and Representatives Lance Gooden (R-Texas-5) and Zoe Lofgren (D-Calif.-18). The Credit Card Competition Act would require the largest credit card issuing financial institutions in the country to enable at least two unaffiliated credit card networks to be used to process credit card transactions.

The Credit Card Competition Act would require that credit cards issued by the nation’s largest banks be enabled to be processed over at least two unaffiliated networks—Visa or Mastercard plus an independent network. Domestic credit card networks like American Express or Discover could also be the second network, but not networks supported by foreign governments like China’s Union Pay. Merchants would be allowed to choose which network to use.

If passed, networks would have to compete to offer the best pricing, security, and service. As written, this legislation would apply only to financial institutions with $100 billion or more in assets—fewer than three dozen institutions nationwide but 90% of Visa and Mastercard credit card volume—and would have no impact whatsoever on small community banks or small credit unions.

Small breweries, especially taprooms and brewpubs, have seen a major increase in credit and debit card transactions and have been impacted by the growing fees. Accepting credit and debit cards is an important and necessary part of running a brewery and giving customers a convenient way to purchase the product. Like many other small businesses, these fees make up a large portion of a brewery’s expenses.

U.S. merchants and consumers pay more than other countries. Average credit card swipe fees in European countries are 0.3% compared to the average rates in the U.S. of around 1.8%. The Credit Card Competition Act and Federal Reserve’s suggested percentage changes would be a good start towards bringing the U.S. more in line with reasonable credit and debit card fees. The BA supports those efforts and will continue to advocate for passage of the legislation.