Small Business Owners Oppose Durbin-Marshall Windfall for Mega Retailers

Small Business Owners Head to Capitol Hill Once Again to Underscore Negative Consequences of So-Called Credit Card Competition Act

Washington, DC – Members of the Small Business Payments Alliance (SBPA) – a group of independent small business owners, entrepreneurs, and tradespeople – headed to Capitol Hill this week to share first-hand the negative impacts that new government mandates would have on their businesses. The SBPA was formed in the wake of proposed changes to the electronic payments system that threaten to reduce credit card payment security, access and benefits.

Here’s what small business owners are saying about the Durbin-Marshall bill:

“I couldn’t have grown my business into what it is today without digital payments. Transitioning to a fully e-commerce platform provides more safety and security than cash, makes operational tasks simpler, and gives my customers an easy way to make purchases. The Durbin-Marshall credit card bill would turn back the clock on all that progress, with no savings or benefits for small business,” said Anne Suinner, owner of “Anne’s Apothecary,” an online skincare retailer in Raleigh, North Carolina.

“Digital payments have made it possible for me to sell products around the world, which makes security and fraud protections critical for my business. My customers rely on the trust and security of the current credit card system. Durbin-Marshall would destroy that trust and make it harder on small businesses like mine,” said Tiffini Gatlin, owner of “Latched and Hooked,” an online hair and beauty retailer in Atlanta, Georgia.

“Durbin-Marshall would mean the end of the travel rewards programs that we depend on to retain employees and run our business. From routine employee travel to our annual staff retreat, our team couldn’t be more grateful for the rewards earned throughout the year. I traveled to Washington this week so I could deliver that message in person – don’t let Durbin-Marshall destroy the rewards programs that our business and employees rely on,” said Chris Renner, owner of “Pinnacle Mountain Homes, a home construction and design company in Frisco, Colorado.

This week’s meetings follow a new report that reveals the Durbin-Marshall credit card bill would “disproportionately benefit the top five businesses in the U.S.” and that any proposed changes to the payment routing system “is demonstrably a favor to large—not small business.”

The report, “Imposing Alternative Payment Networks on Credit Cards Will Likely Hurt Low Income Households and Small Merchants,” from the Chair of the Finance Department at the University of Miami’s Herbert Business School, found that:

“The intent of the proposed Credit Card Competition Act (CCCA) is to reduce routing fees for credit card transactions to save merchants–and hence consumers–money. However, this analysis suggests that almost all of those savings will accrue to retailers with $500 million or more in annual sales, with little going to small businesses. I estimate that 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. Further, small business operators receive roughly $12 billion in credit card rewards when they make purchases on credit themselves, which constitutes roughly one-tenth of all credit card rewards. The CCCA would result in the reduction of such programs, costing small businesses over $1 billion in lost rewards as well as a decline in access to credit. This would further diminish their ability to compete with larger businesses.”

Other key findings from the report include:

  • New government mandates reduce the availability of credit for consumers and small businesses.
  • Durbin-Marshall raises fraud implications arising from transactions being routed to networks without Zero Fraud Liability guarantees.
  • The biggest businesses with the most negotiating power would profit the most from an alternative payment network mandate.