OPINION: Community Banks Lead in Small-Business Credit Access: Proposed Legislation Puts That at Risk

The Credit Card Competition Act, sponsored by Senators Durbin and Marshall, aims to inject competition into credit card networks and lower costs for merchants and consumers. The legislation requires issuers with over $100 billion in assets to enable at least two unaffiliated payment networks and gives merchants control over transaction routing. Community banks are explicitly exempt from this threshold. Yet despite this exemption, community banks will be disproportionately affected because the legislation misunderstands how interchange fees function in two-sided payment markets and why network routing requirements cannot be confined to large banks alone.

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