Credit Card Competition Act Reintroduced

Credit Card Competition Act Reintroduced
Josh Pynn Senior Manager, Payments Content Merchant Advisory Group
Jul 21, 2023

The Credit Card Competition Act (CCCA) was reintroduced with bicameral and bipartisan support on June 7, 2023. Structured very similarly to last year’s duo of bills, the CCCA outlines a mandate that card issuers must enable two non-competing networks on their credit cards, with the intent of creating more competition in the card issuing and card network space. 

Who is sponsoring the bills this Congress?

Similar to the introduction last year, Senator Richard Durbin (D-IL) and Senator Roger Marshall (R-KS) co-sponsored the Senate bill, S. 1838; and this year they are joined by Senator Peter Welch (D-VT), who previously sponsored the bill from the House of Representatives and was elected as a Senator in November, and Senator J.D. Vance (R-OH).

In the House of Representatives, Rep. Lance Gooden (R-TX), Rep. Zoe Lofgren (D-CA), Rep. Thomas Tiffany (R-WI), Rep. Jefferson Van Drew (R-NJ) were original co-sponsors of H.R. 3881. In July, Rep. Max Miller (R-OH) signed on as a co-sponsor as well.

What is included in the Bill?

The CCCA solely focuses on competition through a “No-Network Exclusivity” clause. The main aspects of the legislation are:

  • Requirement that all credit cards issued by covered issuers be issued with at least two non-competing networks.
  • Includes only four-party issuers, meaning American Express and Discover are excluded.
  • Sets the asset minimum for covered issuers at $100 billion. This means that there are 23 issuers covered under the regulation.
  • Outlines that the two non-competing networks cannot be those with the most credit card market share in the United States.
  • Mandates that issuers and networks cannot inhibit routing choice to other networks using security technology such as tokenization or authentication.

The key differences from debit reform enacted in 2011 are the asset requirement and the market share stipulation. There is also an additional clause on routing inhibition included in the text.

What does this bill mean for merchants?

Estimates from consulting firm CMSPI indicate that the passage of the CCCA and the proceeding impact on the card market could lead to over $15 billion in annual card fee savings for merchants due to increased competition in the credit card market.

The legislative process will play out over time, and merchants should talk with their elected officials to share the impact credit card competition will have for their businesses and customers. The MAG is following legislative developments closely and will continue to update the merchant members regarding the CCCA. Please contact Beth Provenzano or Josh Pynn with any questions.

The Merchant Advisory Group

Driving positive change and innovation in the payments industry that serves the merchants interest through collaboration, education, and advocacy.