Senate sponsors of the Credit Card Competition Act strode onto the chamber floor to pitch the bill Wednesday, and detractors rolled out their free doughnut trucks to denounce it.

That amounts to a real battle in Washington. Sponsors of the legislation, including Sens. Dick Durbin (D-IL), Roger Marshall (R-KS) and Peter Welch (D-VT) railed against the big bank card issuers and card network behemoths Visa and Mastercard Wednesday in comments made on the Senate floor.

The senators blamed those “Wall Street” interests for raising credit card fees in a way that hurts not only small local merchants, but also ultimately results in consumers paying higher prices. Durbin called out Visa and Mastercard as a duopoly that controls the credit card network market in the U.S., arguing that the industry is overdue for more competition.

The Credit Card Competition Act would try to inject more competition into the industry by requiring that big banks that issue cards ensure there is at least one network available to merchants that isn’t Visa or Mastercard. Durbin noted that the law, if enacted, would only apply to about 30 of the biggest U.S. banks. He also jabbed at the airlines that offer reward programs tied to popular cards.

“I’ll always choose Main Street over Wall Street,” Durbin said Wednesday on the Senate floor. “It is long overdue for Congress to break up the sweetheart deal that Visa, Mastercard and the biggest banks in America and certain airlines enjoy. We must bring the bipartisan Credit Card Competition Act to the floor for a vote.”

Letter to card networks

In light of the card companies potentially raising some fees later this year, Durbin said he wrote a letter to Visa and Mastercard urging them not to move forward with any hikes. He and the other senators argued that higher fees are particularly harmful in an inflationary environment.

Durbin has crusaded for years against the card networks, always seeking to spur more competition in the industry. He also shepherded legislation restricting debit card transactions more than a decade ago, ultimately getting that legislation passed as part of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.

The bill’s best chance for passage in this Congress may be as an amendment to some other major piece of must-pass legislation, such as the “minibus” government funding proposition being debated on Capitol Hill now. Still, Durbin and Marshall failed to push a CCCA bill through to passage in the prior Congress and fell short of being able to attach it to other legislation.

Marshall has told some bill advocates that he’s intent on forcing a Senate vote on the legislation this year, according to officials at some organizations supporting the proposal.

“Every time you swipe your card, every time, the Visa-Mastercard duopoly and the banks line their pockets,” Marshall said on the Senate floor. He called the fees “price-gouging” and contended they’re seven times higher than similar fees in the European Union, referring to it as a “canyon-size gap.”

In a follow-up comment, his office said: “I’m not going to stand for these massive, wealthy corporations price-gouging small businesses at every turn. Visa and Mastercard’s duopolistic heavy-handed market practices have disproportionately hurt American families and small businesses for far too long.”

Doughnut truck rolls up in DC

Meanwhile, outside the Capitol, the Electronic Payments Coalition, which opposes the bill on behalf of its bank and card network members, rolled up its truck distributing free doughnuts and materials spelling out their arguments against passage of the CCCA. It was the second time this summer that the free food wagon pulled up, following a first visit in July.

The opponents argue that if the bill becomes law, the card companies will have less funding available for rewards programs offered to card consumers, and for investment in fraud protection.

“Donut Touch My Rewards,” the EPC’s slogan reads. The law would “lead to the elimination of credit card benefits that consumers and small businesses rely on – such as credit card rewards for travel, dining, gas points, groceries, and more,” according to information provided by the coalition.

That interest group also argues that it’s the big retailers that are driving the legislation, not the small mom-and-pop merchants that pepper legislators’ districts.

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