The Merchants Payments Coalition (MPC) has encouraged lawmakers to pass the Credit Card Competition Act, noting the legislation is needed to prohibit China from infiltrating the domestic payments processing market.
The MPC forwarded correspondence to House Financial Services Committee Chairman Patrick McHenry (R-NC), Ranking Member Maxine Waters (D-CA), and other committee members in advance of the panel’s recent hearing addressing Chinese economic threats.
“MPC has grave concerns over the level of involvement that China has in our nation’s payments system,” the MPC wrote. “One major area of concern is with the two bodies that govern the security of U.S. payments – the Payments Card Industry Security Standards Council (PCI) and EMVCo. The governing boards of those entities are limited to a handful of companies, and in recent years Visa and Mastercard have welcomed China UnionPay to both small governing boards.”
The MPC maintains the level of involvement China has in the domestic payments system underscores the importance of enactment of the Credit Card Competition Act sponsored by Rep. Lance Gooden (R-TX), Rep. Peter Welch (D-VT), and two Senate colleagues during the last Congress.
“Currently, there is no federal law that prevents any financial institution from doing business with China UnionPay to process payments on its credit cards,” the MPC concluded. “If enacted, the Credit Card Competition Act would explicitly forbid card networks that present a national security threat to the United States (including China UnionPay) from entering the U.S. market. This is a vital provision of the legislation that would significantly serve our national security interests.”
Per the MPC, the measure would ensure an additional network over which a credit card transaction can be routed to protect consumers’ ability to use credit cards and merchants’ ability to complete sales in the event of a network outage.