DCUC Urges Senate to Reject the Credit Card Competition Act

WASHINGTON, D.C. – Today, the Defense Credit Union Council (DCUC) sent a letter to the Senate Banking, Housing, and Urban Affairs Committee strongly opposing the Credit Card Competition Act (CCCA). While framed as a pro-competition measure, DCUC warned the CCCA would pose significant consequences to our Nation’s military and veteran communities, jeopardizing military families’ financial security and undermining credit unions’ not-for-profit mission when serving these populations.
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DCUC’s concerns with potential consequences listed increased fraud risk due to the bill’s routing mandate forcing credit card transactions through less secure networks; how interchange fee reductions would lessen or eliminate rewards programs, bring higher fees, and diminish affordable credit options—all without delivering promised savings to consumers.

“A Federal Reserve Bank of Richmond study found that after debit fee caps were implemented, 98.8% of merchants did not lower prices, and 21% of merchants raised prices, despite their lower processing costs,” wrote Jason Stverak, DCUC Chief Advocacy Officer. “Many retailers even imposed new restrictions on debit card usage instead of passing along any savings to consumers. In other words, large retail merchants benefited by keeping more profit, and consumers saw no relief at the checkout counter. We fear the CCCA would repeat this scenario, enriching major retailers at the expense of everyday Americans, including military families.”

DCUC shared how defense credit unions are able to currently offer low-interest credit cards, financial counseling, and emergency relief programs to these important communities, and yet, the CCCA or similar interchange legislation proposals could force cutbacks, limiting communities’ access to essential financial services, especially concerning military families and areas that are currently underserved.

Unlike large banks, defense credit unions typically operate on thin margins. The CCCA’s costly compliance burdens could also drive these financial institutions out of military and previously abandoned communities, reducing financial choices and contradicting current legislative efforts to expand and strengthen financial access and efficiencies.

“The CCCA threatens to weaken financial protections for those who serve our country, all while enriching large retailers that are unlikely to pass savings to consumers,” says Anthony Hernandez, DCUC President/CEO. “For years, we’ve stressed our concerns with the CCCA and similar legislation. We’ll continue to engage with both houses of Congress to counter these harmful proposals and urge for the continued protection of America’s servicemembers, veterans, and their families.
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For more information, please contact Jason Stverak at [email protected] and visit dcuc.org/advocacy.