“Merchant fees and reward programs generate an implicit monetary transfer to credit card users from non-card (or “cash”) users because merchants generally do not set differential prices for card users to recoup the costs of fees and rewards. On average, each cash-using household pays $149 to card-using households and each card-using household receives $1,133 from cash users every year.”
[Source: “Who Gains and Who Loses from Credit Card Payments? Theory and Calibrations”; Scott Schuh, Oz Shy, and Joanna Stavins; Federal Reserve Bank of Boston; Public Policy Discussion Papers No. 10-03; August 31, 2010.]
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 past 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