How Credit Card Competition Act Would Affect You


Congress likely will vote on the Credit Card Competition Act in 2023, a bill that could eliminate almost all of the funding for popular credit card reward programs like cash back and travel points.

The proposed legislation would allow retailers to process credit card transactions without getting charged processing fees, putting millions of dollars into big-box retailers’ pockets.

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Sen. Dick Durbin (D-Ill.) and Sen. Roger Marshall (R-Kan.) introduced the bill in July but had trouble finding enough support for it by the end of 2022, so it carried over into the new year. Peter Welch (D-Vt.) and Lance Gooden (R-Texas) submitted it to the House.

In my most recent episode of the Live Richer podcast, I talked to Jason Stverak, who currently serves as the Credit Union National Association’s deputy chief advocacy officer for federal government affairs. He shared five ways the act, also known as the Marshall Durbin Interchange Bill, would impact consumers negatively and what consumers can do to prevent it from passing.

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5 Ways the Marshall Durbin Interchange Bill Would Impact You

1. “The bill reduces the credit availability that consumers currently have.”

With credit card companies making less on each transaction, their ability to loan out money would decrease, making it harder for people to gain credit, according to Stverak.

 2. “The bill will negatively impact the amount of money credit card companies have to protect their customers from fraud, making the bill a significant threat to data security and privacy of consumer data.”

Stverak said cyber crimes are rising daily and the amount of money Visa puts into its security and fraud division is astronomical. Decreasing credit card companies’ profit margins will only diminish the funds they have to put toward their security programs, placing the consumer at risk.

3. “Passing the bill is supposed to help small businesses, but the real winners are the mega retailers. Mega retailers who do millions of daily transactions are the ones who genuinely benefit and make money from the bill.”

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The amount of money companies like Amazon, Walmart and Target will save is astronomical. The real winners of the passing of this bill will be large retailers who do billions of transactions a year — increasing their profits at the cost of consumers.

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4. “There is no evidence that retailers will pass savings to customers. If the bill passes, retailers will make more money on each transaction, with no added benefits given to the consumer.”

Stverak said a similar bill passed for checking accounts, and all checking rewards programs disappeared.

5. “The passage of the bill will threaten the rewards programs many Americans depend upon to make ends meet.”

With credit card companies making less money, their ability to give cash-back rewards points and benefits to their customers will disappear, opponents of the bill argue. The need to keep their profits from decreasing and their stock value up will give companies zero wiggle room to provide any monetary benefits to their customers. Many people use their cash-back reward points to offset high grocery prices and can take family vacations only because of their reward points. 

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If you like your current credit rewards program, Stverak said to call your representatives and senators to say, “Do not make any changes. Hands off my rewards.”

“If they don’t hear from you,” he said, “they hear from the retailers’ lobbyists. Every member of Congress has a Twitter account; ask them to oppose the Marshall Durbin Interchange Bill. On all social platforms, you can share #HandsOffMyRewards to let all your followers, friends and family know what will happen to their credit card rewards program.”

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About the Author

With eight years of experience working in the personal finance space at GOBankingRates, Jaime Catmull has amassed an extensive network of financial influencers and experts. Now, she’s tapping that network to get the real scoop on how you can live your best financial life and increase your wealth.
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