Public Pressure Secures Delay in Interchange Fee Hike

"Retailers appreciate the pause in interchange rates, but the news could have come sooner," said Austen Jensen, senior vice president of government affairs for the Retail Industry Leaders Association.

"It was ridiculous that this was even being considered during one of the most severe economic recessions we have seen in decades and a global pandemic," Jensen said. "Only a small portion of the country has received both shots, and we are still facing significant lockdowns and safety requirements."

Jensen said his group has had several meetings with both political parties on Capitol Hill regarding the interchange issue, and virtually no one felt it was a good time to increase rates.

The decision to delay was a case once again of public pressure just like last year, Jensen suggested.

"Unfortunately, 12 months from now, they will go forward with raising rates again and there is nothing to prevent them from doing so in the future as they have done," he said. "The underlying problem here is the lack of competition in the credit card market. When you have two dominant players like Visa and Mastercard, they can raise rates whenever they want to."

The full article can be viewed here: https://www.paymentssource.com/news/card-brands-postpone-fee-hike-but-merchants-want-interchange-reform
 
While the delay in fee hikes helps for now, it is only a band-aid to the larger problem. RILA is educating policymakers to understand this, and with data from our strategic partner, CMSPI, we have a compelling story to tell lawmakers and regulators on fees. And with digital transactions increasing exponentially, the data is persuasive. For more on RILA’s payment committee or how you can get involved in the fight to reform the broken credit card market, contact Austen Jensen.