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Opinion: Protecting our Reward Points, Standing Up for Missourians – Thank You Congressman Luetkemeyer

The word inflation appears in every news headlines these days. It’s no surprise – prices are climbing, and American wallets have certainly suffered the consequences.

Now, Missouri consumers are facing financial threats from big box stores These establishments are ready and willing to raise prices on customers in good and bad times which end up harming local community businesses.

A perfect example of this: the imperfect Credit Card Competition Act (CCCA) that large retailers like Target and Walmart are pushing in Congress. Their reasoning – to allow merchants to run your credit card purchases over alternative networks – might sound harmless enough, if not for one small but important detail. These big-box retailers are not doing this to lower the prices for consumers. They are doing it to save money, and with those savings come serious consequences for American families.

When Congress passed a controversial provision in 2010 called the Durbin Amendment, they aimed to cap interchange fees on debit cards. Large retailers promised that the benefits of this move would be passed on to consumers in the form of lower prices.

They weren’t.

Instead, promises made through the passage of the Durbin Amendment were largely left unfulfilled. Consumers paid more out of pocket as these merchants unsurprisingly did not lower costs. In fact, just the opposite, with about 98% of businesses either increasing prices or keeping them the same following the enactment of the bill. But they did pocket more than $106 billion in profit.

The harm didn’t stop there – money taken out of the debit card system to pad the bottom line then led to the end of free checking accounts for many low-income Americans. It also severely limited reward programs on debit cards that families used to put food on the table.

Now, as if it were Groundhog Day, special interests in Washington are using the same tired talking points they used to convince Congress to intervene with the free market more than a decade ago and place new government mandates on our nation’s secure credit card system. Just like with debit cards, these restrictions will only leave us worse off.

The mandates in CCCA will threaten the credit card reward programs and financial incentives consumers rely on when making their purchases.

A recent study from Airlines for America (A4A) cited the economic impact of airline credit card rewards on U.S. tourism. On average, nearly one of every four U.S. households has an airline credit card. These cards are a powerful tool for consumers to use when traveling, and their

rewards programs generate a tremendous amount of economic activity and jobs. I use them and I expect you do as well.

If these rewards were taken away, the state of Missouri would suffer. According to A4A, an estimated $209 million in domestic visitor spending last year was supported by credit card rewards, nearly $18 million in our state and local tax revenue was supported by these same programs and the total economic impact on our state adds up to nearly $415 million annually.

But if eliminating the rewards programs families use from gas and groceries or the travel points that help support local economies wasn’t bad enough, under CCCA, the security of the electronic payments system would again be under threat, this time on a much larger scale.

In the bill, Senator Durbin wants to move away from running your financial data through the safe and secure credit card networks that Americans know and rely on to turn to cheaper, less secure networks that risk the security of their customers’ data.

Proponents will falsely claim this is to ensure more choice and competition, while ignoring that collectively, large users have experienced malware attacks that compromised the credit and debit card data of over 127 million people. Investing less in untested networks, many of which are not even located in the U.S., would lead to millions more being exposed.

Congress can’t afford to gamble with Americans’ financial security – and U.S. Representative Blaine Luetkemeyer will fight for us to make sure Congress doesn’t. In a recent statement he said, “The Credit Card Competition Act would force consumers to either swallow the cost of fraud or sue the retailer who suffered the breach to get back their money. Neither is an acceptable scenario,” I couldn’t agree more.

Standing against the CCCA is the best way we can shield the consumers of our great state from further financial harm. Missouri cannot afford the consequences of this detrimental legislation. We cannot afford to face increased security threats, pay higher costs, and lose our hard-earned financial incentives and rewards.

The people of Missouri – and their wallets – deserve better.