Electronic Payments Coalition (EPC) Executive Chairman Richard Hunt issued a statement following the release of an opinion regarding the $30 billion settlement reached by Visa, Mastercard, and merchants. The settlement, which benefits primarily small businesses, has faced opposition from larger corporate retailers.
"The corporate mega-stores and their DC lobbyists always opposed this agreement because it treated every retailer – regardless of size – equally. Walmart said as much in its objection. They are instead pushing for the Durbin-Marshall mandates because it stacks the deck for the big guys and against small businesses. Independent research has found the proposed mandates primarily benefit the largest corporate chains and the Congressional Research Service questioned whether small businesses would see any benefit at all," Hunt stated.
Walmart's objection to the settlement agreement indicated that small businesses "traded away the interests of large national merchants for relief that is worthless to the members with the most at stake in this litigation." The settlement was projected to provide approximately $30 billion in relief alongside other technical provisions sought by small business owners.
The Congressional Research Service (CRS) reported last year that "it is unlikely a small business would be aware of a smaller network, and even if it did offer payment on that network, the odds that a bank would issue a card enabled for that exact network are relatively small. Second, if it is impactful, it is unclear who would benefit."
Additionally, a report from the University of Miami found "the largest U.S. retailers would effectively receive a transfer of approximately $2.9 billion from issuers and cardholders impacted by the legislation. But small businesses would save significantly less, if anything, putting small retailers at a further competitive disadvantage than is currently the case."
Hunt concluded by advocating for investment in new technologies and national data security standards to create a stronger payment system.