The National Retail Federation (NRF) was in Washington, D.C. this week to discuss the Durbin-Marshall Credit Card Bill with Members of Congress and their staff. This legislation aims to introduce new mandates on how Americans' credit cards are processed, potentially affecting fraud protection and reward programs that small business owners rely on.

According to NRF lobbyists, these mandates would "help small businesses." However, outside the Capitol, it appears that small businesses were not the primary focus. Notably, corporate mega-stores such as Target, Walmart, and Amazon were prominent supporters of the summit, casting doubt on NRF's claim of aiding small enterprises.

Multiple studies indicate minimal benefits for consumers and small businesses from the proposed Durbin-Marshall mandates. The Richmond Fed reported that 98% of businesses either raised prices or maintained them when similar mandates were applied to debit interchange fees. Additionally, a Congressional Research Service report questioned whether these groups would benefit at all. The University of Miami found that such mandates could place small businesses at a competitive disadvantage against larger corporations.

In a historical context, when Visa and Mastercard reached a $30 billion settlement with merchants—90% of which were small businesses—the NRF and Walmart objected. Walmart claimed that small businesses had "traded away the interests of large national merchants for relief that is worthless to the members with the most at stake in this litigation."

Consumers have also been impacted by these large corporations. A recent Federal Trade Commission report criticized Walmart and Amazon for using their market power to avoid supply disruptions during the COVID-19 pandemic while keeping grocery prices high to boost profits.

The evidence suggests that the largest corporate mega-stores stand to gain the most from these proposed credit card processing mandates rather than consumers or small businesses.

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