One piece of proposed legislation that has stirred up a lot of conversation in Nevada is the Credit Card Competition Act of 2023, a bill that was proposed back in June—the House version is currently under consideration by the House Financial Services Committee.
If approved, the bill would prevent credit card providers whose assets exceed $100 billion from limiting the amount of card networks that process electronic transactions.
Per the language of the bill, all transactions would have to have the option of being processed on more than one network and would not be restricted to networks affiliated with or owned by the card provider, networks considered to be national security risks or networks with the largest market share of issued cards.
This legislation ostensibly goes after the existing Visa-Mastercard duopoly, the structure and influence of which makes it so that sellers and vendors essentially have to accept whatever fees and rates may be applicable or risk losing all customers under a given card provider.
The reason why lawmakers in Nevada are keyed into the bill’s progress is that card providers have warned that popular consumer rewards programs could take a hit or disappear completely if the so-called interchange fees are reduced, which means that leisure travel to destinations such as Las Vegas could decline.
According to the Las Vegas Sun, more than 800,000 people booked flights to Nevada in 2022 using credit card miles or rewards, which amounted to an overall impact of over $1 billion. These figures only included major airlines, and did not take into account smaller carriers such as Frontier and Spirit.
“For a state like Nevada, where travel and tourism is such a big component of the economy, I think the story writes itself,” Josh Saltzman, vice president of governmental affairs for the lobbying group Airlines for America, told the Sun. “It’s very clear what the impact is.”
That being said, others have pointed out that the bill does not include anything related to rewards programs, and any drops in revenue would likely have minimal impact on such systems.
“At the end of the day, these programs aren’t regulated by any agency or anything like that,” Dylan Jeon, vice president of legal affairs for the National Retail Federation, told the Sun. “It’s totally at the control and discretion of the banks or the airline that manages them.”
An anonymous Nevada congressional aide told the newspaper that the bill has received an immense amount of constituent feedback, to the tune of almost 1,000 emails and calls placed, which is said to be extremely high.
One prominent state lawmaker, Lieutenant Governor Stavros Anthony, has already expressed his support for the measure, having published an editorial in the Nevada Current in recent weeks with the argument that it could save Nevada consumers $1,000 per year or more.
Senator Jacky Rosen’s office gave a statement to the Sun saying that Rosen “shares concerns that it could threaten many of the popular credit card programs that people across the country use to visit destinations like Las Vegas and support Nevada’s economy.”
Rep. Steven Horsford, who sits on the finance committee currently considering the bill, said in a statement that he has discussed the bill and its potential impacts with “constituents, consumer advocates and the financial sector.”
“I am working every day to decrease costs for everyday Nevadans, but (I) also value the economic impact credit card rewards programs have on our local economy,” the statement continued. “I will continue to engage with relevant groups on this legislation, especially if the bill has any progress in the legislative process.”
