The Sconi

Iain Murray, a political economist at the Competitive Enterprise Institute, has expressed concerns regarding the Credit Card Competition Act. He said on X that the proposed legislation would eliminate rewards programs and restrict credit access.

"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 introduce multiple routing options for credit card transactions. This initiative is intended to foster competition among networks by reducing merchant fees and challenging the market dominance of Visa and Mastercard. The bill has ignited significant debate concerning its potential effects on consumers and rewards programs.

The Nilson Report indicates that as of 2023, Visa and Mastercard accounted for approximately 42% and 22% of U.S. credit card purchase volume, respectively. These networks operate independently and compete for market share through pricing strategies and partnerships. Together, they represent a substantial portion of U.S. card-based transactions.

The Electronic Payments Coalition has voiced concerns that routing mandates under the Credit Card Competition Act could lead to reduced consumer rewards and heightened fraud risks. Following the implementation of debit routing mandates, several Wisconsin banks reportedly ended or scaled back their rewards programs. The coalition warns that similar consequences could arise from credit card regulation.

Murray is a British-American economist recognized for his advocacy of free-market principles. At the Competitive Enterprise Institute, he concentrates on economic freedom and regulatory issues. Additionally, he is a published author with a background in classical studies.