If you’ve been following the ongoing debate over credit card processing fees, here’s a development worth your attention: the fight over interchange regulation is moving to state legislatures — and the payments industry is pushing back hard.
What’s Happening in Colorado and Delaware
The Electronic Transactions Association (ETA) is actively opposing two pieces of state legislation that would impose new restrictions on interchange fees — the fees that merchants pay every time a customer uses a credit or debit card.
In Colorado, ETA’s Vice President of State Government Affairs, Christy Ellerbee, traveled to Denver to monitor SB 134 firsthand. ETA submitted a formal letter to state Senate members emphasizing the value of interchange and its critical role in supporting the broader payments ecosystem.
Meanwhile, in Delaware, ETA sent a letter opposing HB 315, continuing its effort to educate lawmakers on how the U.S. payments system actually works — and why interchange fees aren’t just arbitrary costs imposed on merchants.
Why Interchange Fees Matter to Your Shop
For auto repair shop owners, interchange fees are one of the biggest line items in your payment processing costs. Every time a customer pays with a credit card for a brake job or a transmission repair, a percentage of that transaction goes to interchange. Over the course of a year, those fees add up to thousands of dollars.
That’s exactly why some state lawmakers are proposing caps or restrictions. The idea sounds appealing on the surface — who doesn’t want lower fees? But the reality is more complicated.
The Other Side of the Coin
Interchange fees fund important parts of the payment ecosystem that merchants and consumers both rely on:
- Fraud protection: The systems that detect and prevent fraudulent transactions are expensive to build and maintain. Interchange helps pay for them.
- Rewards programs: Those cashback and points programs that drive customers to use their cards? Funded by interchange.
- Network infrastructure: The technology that lets you accept a card payment in seconds — processing it through multiple networks securely — requires massive ongoing investment.
If interchange is capped too aggressively, there’s a real risk that these services get scaled back, fraud costs shift to merchants, or card networks find other ways to recoup revenue that could end up being worse for small businesses.
What This Means Going Forward
ETA has signaled it will remain actively engaged as state legislative sessions continue across the country. This isn’t just a Colorado and Delaware issue — similar bills could pop up in your state next.
For shop owners, the smartest move is to focus on what you can control: your processing setup. Solutions like dual pricing and surcharging give you tools to offset credit card fees right now, without waiting for legislation that may or may not help.
Whether interchange regulation moves forward or stalls out, having a strategy to manage your processing costs puts you ahead of the game. We’ll keep tracking these legislative developments and let you know when something changes that affects your bottom line.