“Our analyses show that as payment card markets evolve, the interchange fees increase over time. This is because a monopoly card network, besides internalizing the two-sided market externally, has the incentive to inflate the value of card transactions.”
[Source: “The Economics of Two-Sided Payment Card Markets: Pricing, Adoption and Usage,”; Federal Reserve of Kansas City; James McAndrews and Zhu Wang, December, 2008. - Emphasis added]
Numerous studies have been conducted by federal agencies, the GAO, academics and the Federal Reserve, each one each identified market problems caused by swipe fees. Now some in Congress want to undo the meaningful reforms passed a year ago, proposing instead to conduct yet another study. With relief just three months away, Congress should stand up for small businesses and consumers and LEAVE SWIPE FEE REFORM ALONE!
For a summary of the many reports, studies and expert commentary related to swipe fee reform visit http://www.unfaircreditcardfees.com/testimony-reports
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