Convenience stores and gas stations operate on razor-thin margins. From soaring credit card swipe fees to lottery theft siphoning off profits behind the counter, convenience stores and gas stations face challenges that chip away at profits every day.
There are an estimated 152,000 convenience stores in the United States, 60% of which are single-store operators. These businesses have seen a historic jump in their swipe fees with inflation and rising gas prices. Since 2020, overall card fees paid by the convenience store industry are up 84%.
For many convenience retailers, swipe fees are the second-largest operating expense, right behind labor. And here’s the kicker: these fees are largely controlled by just two major service providers, Visa and Mastercard, which together handle 83% of all credit card transactions in the United States. This overwhelming market control leaves retailers with virtually no choice but to accept both networks. Since credit card fees are calculated as a percentage of the total transaction value, they rise proportionally with inflation, making every price increase even more costly.
But there’s good news! The Credit Card Competition Act (CCCA), a bipartisan initiative, aims to reduce a significant cost for retailers: credit card swipe fees. The act introduces regulatory measures that would require major banks to allow greater competition in credit card processing. For convenience store owners, this means more choices, lower fees, and the potential to reinvest those savings into other areas of the business—such as expanding lottery retail operations.
As the Marshall-Durbin Amendment aims to tackle these fees, the increased competition it introduces will benefit the entire retail industry.
More options will create competition between networks, encouraging them to offer better prices and drive down fees to win retailers. From the business side, retailers can save money on transactions and boost their profitability.
Senators Marshall and Durbin have proposed their amendment as part of the broader GENIUS Act, a cryptocurrency bill that NACS also endorses. If the Senate approves the Marshall-Durbin Amendment and incorporates it into the GENIUS Act, a vote on the full bill could take place following the Memorial Day recess.
The Marshall-Durbin Amendment is supported by almost 2,000 companies and nearly 300 trade associations as well as a broad group of consumer, labor and pro-competition organizations.
However, it’s also important to note that this proposed legislation only applies to banks with more than $100 billion in assets, exempting the vast majority of banks and credit unions in the United States, including community banks and other small and mid-sized regional banks.
Along with NACS and thousands of retailers across the country, LottoShield proudly supports the Credit Card Competition Act. We’re fully committed to backing convenience store owners, especially single-store operators. Credit card fees have become unsustainably high, placing a significant burden on smaller, family-run businesses. In fact, they cost the average U.S. household nearly $1,200 each year.
This legislation will lower fees and ease the financial burden on retailers, enabling them to reallocate those savings into other areas of the business, such as improving inventory, customer service, or employee wages.
The Credit Card Competition Act is a crucial piece of the puzzle, landmark legislation that opens the door to a new era of payment processing, marked by fairer swipe fees and greater transparency. Retailers are encouraged to contact their legislators and voice support for the Credit Card Competition Act to help ensure it crosses the finish line.