A proposal to add new credit card routing mandates and a related study to a major defense spending bill has no place in the legislation and would harm military families, ABA and nine financial industry trade groups said in a letter to congressional leaders today. Sens. Richard Durbin (D-Ill.) and Roger Marshall (R-Kan.) last week filed an amendment to add language from their ABA-opposed Credit Card Competition Act to the National Defense Authorization Act, which Congress will take up this month. They also introduced a second amendment to require the Defense Department and Treasury Department to coordinate on creating a report of the top 10 debit and credit card issuing financial institutions whose cards are used at military concessions.
In their letter, the trade groups—which included those for military-serving banks and credit unions—said the two amendments “will rob military families of their credit card rewards, reduce the availability of safe credit and undermine the nation’s data security.” The amendments “have been filed with the goal of enriching the largest multinational retailers and obscure payments processors and have no business being added to annual legislation designed to bolster our national defense. After months spent failing to obtain more than a single co-sponsor for the CCCA, it does not belong in NDAA.”
The groups said the study would be a waste of taxpayer dollars because it would duplicate already existing data and not research how rising retail prices affect military families. “It is cynical and disrespectful to those who served and sacrificed to invoke Purple Heart recipients, POW-MIA heroes and disabled American veterans in a desperate attempt to buoy the earnings of corporate retailers, yet the study amendment does so,” they said.
As for the new routing mandates, the groups reiterated that the changes Durbin and Marshall are proposing would reduce the number of credit card issuers competing for consumers’ business, limit popular credit card rewards programs, and put the nation’s private-sector payments system under the micromanagement of the Federal Reserve Board. “Congress should not double down on this failure in this year’s NDAA, especially considering it is not germane to this bill,” they said.