Monday, March 4, 2024
Homebusiness creditLowcountry business owners concerned federal credit card bill could hurt tourism

Lowcountry business owners concerned federal credit card bill could hurt tourism

CHARLESTON, S.C. (WCSC) – Lowcountry business owners are concerned about whether a Congressional bill has the power to tank the state’s economic growth.
The Durbin-Marshall Credit Card Bill, or the “Credit Card Competition Act,” would change regulations for how those transactions are processed. The goal, Senate Majority Whip Dick Durbin says, is to increase competition in the merchant and consumer industry by limiting interchange fee rates on big brands like Visa or Mastercard.
While some small businesses have responded positively to the bill, others in the Charleston area say it could pose a risk to the Palmetto States’ financial well-being.
“Cash back, airline miles, hotel points. All those credit card reward programs would virtually be eliminated. Consumers and small business owners, most importantly tourism, would lose,” Former Chairman to the Consumer Bankers Association Gene Kirby says.
Tommy Doyle owns a carriage tour business in the downtown Charleston area. Palmetto Carriage Works has been an integral part of the Lowcountry since it was founded in 1972.
“Really, running commercial carriages for most of my life. I’ve never had another job,” Doyle says. “We carry hundreds of thousands of people a year.”
A report from the College of Charleston’s Office of Tourism states the economic impact of tourism cannot be overstated. It hit a $12.8 billion record high in 2022 and the industry employs more than 51,000 people in Charleston alone.
Doyle says he happily chooses to take on credit card fees because it is what has worked for them.
“I ran a report on how much of my business was credit cards last year, it was almost 90%. Charleston in particular has become so expensive to come to, I think people do take advantage of those rewards programs,” Doyle says.
A bill passed in 2010, called the Dobb-Frank Act, eliminated debit card points and rewards programs for many and regulated transactional uses.
Kirby says the outcome was a much better buy for big retailers and left small business owners in the dust.
“It did the same thing, change the way interchange fees were calculated. Large retailers, the Walmarts, Targets, Amazons, benefited with billions of dollars to their bottom line. They promised to pass that through to the consumer. Hadn’t happened,” Kirby says.
“The big retailers, they’ve got a bit more muscle to negotiate with their fees, their percentages,” Palmetto Carriage Works owner Tommy Doyle says. “We run a lot of money through here, but compared to Target, Costco, Walmart. There might be an argument that those bigger retailers will benefit more, and the smaller guy gets squeezed harder.”
Kirby says out of 486 million credit cards circulated across the country, 41% of them are tied to travel and 25% are connected to airlines.
Both Kirby and Doyle worry the Palmetto State could lose millions.
“It’s going to dramatically impact the number of people coming to Charleston which will flow through to small business owners in downtown Charleston and across the Lowcountry,” Kirby says.
“The system we have now, it works, this is a thriving business,” Doyle says. “The impact of that law, one way or another, I see if it passes will probably have more of a negative impact.”
Senators Lindsey Graham and Tim Scott did not respond to a request for comment on the bill’s impact on South Carolina, or how they are planning to vote.
Copyright 2024 WCSC. All rights reserved.



Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Recent Comments

Translate »