Consumers prefer using electronic payments when making purchases at small businesses. As consumer preferences continue to shift towards using cards and digital payment apps
over cash, small businesses that accept these payments offer a better customer experience and generate higher sales, allowing them to better compete with larger firms.

The Durbin-Marshall credit card bill was introduced last year in Congress as the “Credit Card Competition Act” (CCCA), and the bill’s sponsors are pushing for a vote this fall. The proposed legislation is a direct threat to the electronic payments and rewards system and would have a major negative impact on small business owners who use credit cards and rewards to support their businesses. Despite its name, the legislation would circumvent the competitive market with a new government routing mandate that would dictate processing networks, without regard to security or quality.

New data from the Small Business Payments Alliance once again reaffirms the value of credit cards for small businesses. According to consumer surveys and research gathered over the first quarter of 2024, credit cards continue to provide crucial benefits to small businesses.

This research note finds the proposed Credit Card Competition Act (CCCA) will likely generate between $13 billion and $15 billion in transfers to merchants from financial institutions and consumers. However, this distributional analysis finds almost all of those savings will accrue to retailers with $500 million in sales or more—none of which constitute small businesses under the Small Business Administration’s (SBA) definition.