The Sconi

Iain Murray, a political economist at the Competitive Enterprise Institute, expressed concerns over the Credit Card Competition Act, suggesting it would eliminate rewards programs and restrict credit access. His statement was made on the social media platform X.

"This will kill reward programs and reduce credit availability," said Murray.

According to Congress.gov, Senate Bill 1838, known as the Credit Card Competition Act, aims to mandate multiple routing options for credit card transactions to foster competition among networks. The bill seeks to reduce merchant fees and challenge the market dominance of Visa and Mastercard. It has sparked significant debate regarding its potential impact on consumers and rewards programs.

The Nilson Report indicated that as of 2023, Visa and Mastercard accounted for approximately 42% and 22% of U.S. credit card purchase volume, respectively. These two networks operate independently and compete for market share through pricing strategies and partnerships. Their combined presence represents a dominant share of U.S. card-based transactions.

The Electronic Payments Coalition has raised concerns that routing mandates under the Credit Card Competition Act could diminish consumer rewards and increase fraud risks. The coalition noted that after debit routing mandates were implemented, several Wisconsin banks reportedly ended or reduced rewards programs. They warn that similar outcomes could occur with credit card regulation.

Murray is a British-American economist known for advocating free-market principles. He works at the Competitive Enterprise Institute, focusing on economic freedom and regulatory issues. Murray is also a published author and former classicist.