Amber Morgan is the small business owner of Fortin Gage, a floral design shop in Nashua.

According to Slack’s latest “Small Business Outlook” survey, the top two concerns for small businesses are inflation and having to raise prices. One of the drivers of inflationary pressure that often flies under the radar for consumers is credit card swipe fees. Despite the economy growing as a whole, many local shops are still feeling the pinch, and credit card swipe fees are only making it harder to stay in business while providing goods at affordable prices.

For Fortin Gage, these swipe fees are a considerable chunk of what we have to budget for each year. Credit card transactions are the rule, not the exception for our business. We allocate tens of thousands of dollars a year toward these fees, often costing us as much as a new employee. But we’re lucky. We’ve been in business since 1931 and thankfully have a loyal customer base that allows us to keep up with costs. I can’t imagine what it would be like for a new florist to enter the market. The rising cost of swipe fees alone would be prohibitive.

Growing more than 50 percent since 2020, swipe fees average around 2.26 percent of every credit card purchase, and these rates continue to climb. This is because Visa and Mastercard don’t share the same concerns that small businesses do. While small businesses bore the brunt of record inflation and were forced to raise prices just to keep their doors open, these credit card behemoths were boasting massive profit margins and posting record earnings. At one point, Visa even bragged to investors that inflation was good for business.

Having consolidated 80 percent of the market share, Visa and Mastercard no longer fear competition. In fact, their dominance in the sector has allowed them to box out their competitors and continue leveraging and raising swipe fees. While banks charge merchants these fees, Visa and Mastercard set them. Given Visa and Mastercard offer banks a universal rate schedule, those banks can rest assured they won’t have to compete with other banks on price. Instead, there is monopoly pricing for everyone.

For merchants, this price-fixing scheme manifests itself in more than $126 billion in credit card swipe fees paid by merchants in 2022, jumping more than 20 percent from the year prior. In New Hampshire, our businesses spend over $388 million a year in credit card swipe fees, pumping vital revenue from our local community to Wall Street corporations.

While credit card use continues to increase, many merchants report swipe fees as their second-highest operating expense after labor, often forcing businesses to raise prices to cover costs. It’s estimated that Americans pay over $1,000 a year in higher prices as a result of swipe fees. Equivalent to the average monthly cost of childcare in New Hampshire, it’s clear these fees are not just a strain on the budgets of business owners but on working families too.

Many retailers are also unable to establish different prices for customers using cash compared to those using credit cards. This disproportionately affects vulnerable consumers, particularly the millions without credit cards or bank accounts, who mainly rely on cash. These individuals end up subsidizing the card usage of wealthier individuals by paying higher prices for everyday essentials like groceries, fuel, and other products and services.

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That’s why a bipartisan group of lawmakers has introduced the Credit Card Competition Act (CCCA) to help correct the current market failure and create just a little competition to drive down credit card swipe fees. This legislation would give merchants the opportunity to choose between at least two different routing networks, encouraging Visa and Mastercard to offer more competitive rates or risk losing business. With new competitive pressure, credit card companies would be inclined to reduce excessive swipe fees and improve their services to invite more businesses to use their network.

While the CCCA would have a deep impact on reducing fees and spurring innovation, it’s also careful to avoid negative side effects on smaller community banks and credit unions by excluding financial institutions with less than $100 billion in assets. This will ensure the giants feel the market pressure while local institutions don’t need to do anything new.

Small businesses play a major role in our state’s economy, and we cannot allow Visa and Mastercard to continue to siphon away even more vital revenue as inflationary pressures and rising competition linger. Granite Staters need support from Sens. Maggie Hassan and Jeanne Shaheen to pass the CCCA and provide financial relief to merchants and, in turn, consumers.