DENTON, Texas – In a recent opinion piece in the Denton Record-Chronicle, NACS Legislative Committee member and former NACS Chairman of the Board, Bill Douglass of Douglass Distributing Company, shared his thoughts on the current state of the credit card industry, which he says “looks more like the old Soviet Union than the free market that created the biggest economy on earth.”

In his piece, Douglass recalls his many trips to meet with legislators in Washington, D.C., to educate members of Congress on our industry, and uses the newspaper op-ed to educate the public similarly, explaining how many consumers don’t even have any idea how the banks are “gouging” merchants with every card swipe.

“Because [card swipe fees are] hidden from people — seen only by merchants and the banks that exploit them — and because the banks have so much money and influence, it’s almost impossible to make the banks charge fair and reasonable fees,” Douglass writes.

Douglass, whose family business includes 20 gas station/convenience stores in the Dallas suburbs, goes on to describe the exorbitant swipe fees of $100,000 that his company pays each month. “More than we make in profits,” he writes. “In fact, we have never made more than the banks on my stores, despite the fact that all the risk, all the investment in time and money, all the hard work is mine and my family’s.”

Douglass’ story is not unique, the entire convenience store industry pays out more in swipe fees than it earns, a staggering $11 billion compared to $7 billion in convenience store operating profits last year. According to Douglass, swipe fees are his second-highest operating cost, after labor — a fact that is true for many merchants these days.

In the op-ed, Douglass shares an example of the banks’ power: “In 2008, I went to Washington to testify before the Senate Judiciary Committee. I mentioned the banks imposed a 1,500-page contract on merchants that we weren’t allowed to read. The chairman demanded the banks produce it. The banks took more than a year to comply with this simple request,” he recalled.

“Americans need to know how the banks are squeezing the stores people patronize — and the people themselves in the form of higher prices. My prices are on a big sign up high over motorists’ heads, where even from a long way off they can see and compare them to my competitors,” he wrote. “Not so in banking. Perhaps the more light we can shed on this murky industry, the more we can reform it and make it fairer. Until then, though, we merchants — and you consumers — are stuck with the kind of uncompetitive, unfair and outrageous behavior that goes against everything that is best in our free-market system.”