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Credit Card Routing Mandate Proposal Will Harm Consumers


By D. Gene Dikeman II, President-CEO of The Bank of the Plains and Chair-Elect of the Kansas Bankers Association Board of Directors


Senators Roger Marshall (R-KS) and Dick Durbin (D-IL) have introduced legislation expanding government routing mandates to the credit card market. It is important that every Kansan who uses a credit card understands that this bill represents government intervention every time they use their personal credit card.

Most people don’t think twice when they use a credit card – and I, as just one of many Kansas bankers – want to keep it that way. The safety and convenience of using a credit card benefits individual consumers and small businesses alike. The Marshall-Durbin bill puts that at risk by mandating that merchants can choose how card transactions are routed so that they can choose a cheaper payment rail to help drive down their costs. But as we all know, cheaper isn’t necessarily better. There is a cost to maintaining the safest and most secure routing networks and a cheaper network could put your personal financial information at risk!

In addition, the reward programs attached to the credit cards you use today could go away if cheaper routing rails are chosen by a merchant. Just imagine that you use your credit card to make a purchase – thinking that you will be receiving points on that purchase only to find out that the store where you bought the item diverted your purchase to a different routing rail and so no points were awarded to you. This bill will take that decision out of your hands.

If Senator Marshall truly wants to promote competition, protect consumers, and support small businesses, he should withdraw his support for the Marshall-Durbin bill and join the Main Street financial institutions across Kansas who oppose government mandates on consumers’ financial decisions.