Retailer-backed legislation creating new credit card routing mandates was left out of a bipartisan omnibus spending bill after a sustained grassroots campaign by the American Bankers Association and state banking associations warned lawmakers about the risks community banks faced had the proposal become law.
The Credit Card Competition Act was first introduced in the Senate by Dick Durbin (D-Ill.) and Roger Marshall (R-Kan.) in July, with Reps. Peter Welch (D-Vt.) and Lance Gooden (R-Texas) later introducing a nearly identical House bill. Both bills failed to gain traction and any additional cosponsors as standalone proposals, so their authors attempted to add the legislation as an amendment to a must-pass piece of legislation like the omnibus spending bill. However, the spending bill unveiled today by Democrat and Republican negotiators contained no language from the Credit Card Competition Act, with few changes expected before Congress votes on the measure and wraps up later this week.
This marks the third defeat for the Credit Card Competition Act in recent months, with groups representing large merchants having also failed to persuade Congress to include the bill during the budget reconciliation process and then in the National Defense Authorization Act. As awareness of the bill has increased, so too have the organizations opposed to it, including military banking organizations, the major airlines and leading travel experts.
ABA and other trade groups opposed the Durbin-Marshall bill since its inception and, along with state banking associations, urged bankers to contact their lawmakers and explain how the legislation would harm both community banks and consumers. ABA also significantly expanded its months-long advertising campaign earlier this month, highlighting the legislation’s detrimental effects. The bill’s sponsors “have introduced anti-consumer legislation that would reduce choice, jeopardize consumer data security, and eliminate travel points and other popular credit card rewards programs,” ABA President and CEO Rob Nichols said at the campaign’s launch. ABA will continue to actively oppose the legislation and any effort to revive it in the next Congress.
