Blog sponsored by Bankrupt-Law.com


Retailers and credit card companies, who united a year ago on bankruptcy
reform, were on opposite sides of a House Commerce, Trade and Consumer
Protection Subcommittee hearing examining fees that banks charge merchants
for credit card transactions. Testifying were representatives from the
Electronic Payments Coalition, the National Association of Convenience
Stores, the Small Business and Entrepreneurship Council and the U.S. Public
Interest Research Group. Merchants, represented by the National Association
of Convenience Stores, welcomed Congressional attention to the issue as they
argued that some credit card companies engage in monopolistic practices by
charging stores a fee of about 2 percent for each transaction when a
customer uses plastic. Card issuers, represented by the Electronic Payments
Coalition, disagreed, contending that their networks bring stability to a
21st Century economy that relies heavily on electronic commerce. They noted
that they provide a quick and efficient service with major safeguards to
prevent fraud, along with incentives for free airline trips and cash
rebates.