NGA to Senate committee: Credit card duopoly driving higher costs for consumers and merchants
Washington, D.C. – The National Grocers Association (NGA), the trade association representing the independent supermarket industry, called on lawmakers to fix the “broken” U.S. card payments system and stem the rising tide of swipe fees that compound the impact of inflation and cost merchants and consumers billions of dollars annually.
NGA submitted a statement for the record to the U.S. Senate Committee on the Judiciary in advance of the committee’s Wednesday morning hearing, “Excessive Swipe Fees and Barriers to Competition in the Credit and Debit Card Systems,” convened by Chairman Dick Durbin (D-IL) and Ranking Member Chuck Grassley (R-IA).
“For more than a decade, Visa and Mastercard have set not only their network fees – the costs associated with a credit or debit card payment being routed through their network, but the interchange fees that merchants pay to the issuers of the credit and debit cards that Americans transact with. Nearly twice a year, every year, these two card networks have instituted fee changes which, on net, almost always lead to increases in merchants’ costs,” NGA declared in the statement. “This hearing comes on the heels of a net $1.2 billion increase in interchange fees implemented by Visa and Mastercard in April 2022.”
“U.S. merchants pay the highest swipe fees in the industrialized world, but they have no ability to affect these costs,” said Greg Ferrara, NGA president and CEO. “These anticompetitive fees imposed on independent grocers drive up the costs of food and other goods at a time when Americans are already reeling from a level of inflation not seen in a generation.”
“The two global networks centrally set the pricing and structure of swipe fees,” noted Robert Yeakel, NGA vice president of government relations. “In any other market, be it grocery or elsewhere, if prices were centrally set by two companies for the rest of the industry’s participants, there would be significant antitrust concerns. In the credit card space, however, this has been industry practice for more than a decade.”
The full text of the statement is available here.