Credit Card Competition
Small business owners operate on thin profit margins, which have been increasingly cut into in recent years as credit card “swipe fees” have increased. Small businesses do not have the market power to negotiate with large credit card companies on “swipe fees,” so legislation in Congress is seeking to introduce crucial competition into the market.
Swipe fees have more than doubled since 2012 and the problem has been exacerbated by pervasively high inflation, which acts as a multiplier as swipe fees are a percentage of each sale. NFIB urges Congress to consider legislation that will harness the power of competition to give small business owners real choices when it comes to credit card processing networks. In an NFIB member ballot, 92% of NFIB members believe small business owners should have the right to choose among multiple credit card processing networks.
Two identical pieces of legislation were introduced in the U.S. House of Representatives and the U.S. Senate that would promote the freedom of choice and allow small businesses the ability to choose between at least two credit card network options to process transactions. NFIB wrote letters of support to the House and Senate for H.R. 8874 and S. 4674 in the previous Congress and will submit new letters of support when the bills are re-introduced this Congress.
Learn more about the impact these two bills could have on small businesses if Congress moves forward with them in the 118th Congressional Session.
Take Action: Tell Congress to rein in credit card swipe fees and allow small business owners the ability to choose between credit card networks.
Big Tech Antitrust
Big Tech companies like Amazon and Google, which run online marketplaces, engage in practices that are biased against small businesses, which lack bargaining power and alternative choices. For small business sellers using marketplace platforms, competition between the operator’s own products and third-party sellers creates conflicts of interest and has been shown to lead to unfair business practices.
On Nov. 17, 2022, NFIB members Mark Faulkner and Deeannah Seymour made the case for Big Tech antitrust legislation in front of a U.S. Senate briefing and explained their concerns in brief video testimonies. NFIB also hosted a virtual briefing with a panel of five small business owners and Rep. Ken Buck (R-CO) who is a principal U.S. House author of the American Innovation and Choice Online Act. Each of the five panelists spoke to their experience using big tech across a variety of platforms.
In an NFIB member ballot, 84% of NFIB members favor Congress taking legislative action to control dishonest and anticompetitive practices of large tech companies.
S. 2992, the American Innovation and Choice Online Act, introduced in the previous Congress, would ensure equality for small businesses and options for consumers. NFIB supports preventing companies like Amazon and Google from engaging in practices such as promoting their products over higher reviewed products from a small business and adding accountability so small business owners can trust their products will be sold impartially.
Take Action: Join NFIB in urging Congress to consider legislation that seeks to remedy conflicts of interests and ensure a level playing field for small businesses and users of platforms covered by the legislation.
Pharmacy Benefit Manager (PBM) Reform
Anti-competitive behavior and a lack of transparency on the part of Pharmacy Benefit Managers (PBMs) have resulted in significant barriers to affordable healthcare. PBMs have created barriers to competition in the delivery of pharmacy services in community pharmacy settings, resulting in increased costs and reduced choices for small business owners and employees. Additionally, many small business pharmacies are struggling due to the deceptive practices of PBMs, resulting in less access to care.
NFIB supports reforms to ensure healthy competition and affordability by increasing transparency and ending anti-competitive behavior that harms small business pharmacies and patients generally.
PBMs’ tactics, such as spread pricing and “claw back” reimbursement payments, are problematic for NFIB members and often designed to put small pharmacies out of business and steer patients to large retail or mail order pharmacies. To fight these practices and the limited transparency into how these large companies operate, NFIB has signed a joint letter of support for S. 4293, the Pharmacy Benefit Manager Transparency Act of 2022, in the previous Congress. This bill seeks to prohibit anti-competitive behavior and increase transparency.
NFIB is a founding member of the Coalition for PBM Reform to engage and amplify the voices of small businesses regarding how PBMs threaten broad and affordable access to local healthcare. The goals of our coalition are:
- Patient choice of pharmacy
- Patient access to lowest cost medications
- Transparent pharmacy reimbursement
- Full transparency of true drug costs to employers/plan sponsors
Take Action: Join other small business owners in telling Congress to support the Pharmacy Benefit Manager Transparency Act and its price transparency to small businesses through PBM reform.