By Jason Stverak
As Congress considers the FY2026 National Defense Authorization Act (NDAA), a troubling proposal has emerged under the guise of helping veterans. An amendment by Senator Roger Marshall (R-KS) and Senator Dick Durbin (D-IL) calls for a “study” on credit and debit card interchange fees at military commissaries – ostensibly to benefit Medal of Honor recipients, Purple Heart recipients, former POWs, disabled veterans, and their caregivers.
In reality, this amendment is a thinly veiled effort to revive the rejected Credit Card Competition Act (CCCA) by exploiting our nation’s heroes as political cover. The Defense Credit Union Council, on behalf of America’s defense credit unions serving over 40 million members, strongly opposes this maneuver. It would do nothing to help military families; instead, it advances a divisive agenda that benefits big retail and e-commerce giants at the expense of servicemembers. Such an exploitative proposal has no business being attached to the NDAA or any must-pass legislation.
A “Study” In Name Only – Reviving A Failed Policy
Make no mistake: the Marshall - Durbin interchange fee study is a pretext to reignite the CCCA, a measure Congress has wisely sidelined before. By invoking decorated veterans and caregivers, the amendment attempts to lend an air of patriotism and urgency to what is fundamentally a retail-industry wish list. As DCUC previously warned Senate leaders, this amendment “exploits Medal of Honor [heroes] and their caregivers to reignite calls by merchants for cheaper, unsecure networks with zero accountability.” In plainer terms, it’s using wounded warriors and Gold Star families as pawns to push an interchange policy that big-box retailers like Amazon and Walmart have long lobbied for. Tying this agenda to the NDAA – a bill meant to support our troops and national defense – is a cynical attempt at a legislative shortcut. It’s an approach that disrespects both the legislative process and the very veterans it purports to help.
Who Really Pays At The Commissary? (Hint: Not Our Veterans)
The premise of the Marshall amendment is that disabled veterans and other honored groups are being charged extra “swipe fees” when they use credit or debit cards at commissaries and Morale, Welfare, and Recreation (MWR) facilities. This is misleading in the extreme. In reality, the Defense Commissary Agency (DeCA) – backed by the U.S. Treasury – has negotiated special interchange fee rates with card networks. As a result, it is the federal government paying these fees at commissaries and MWR facilities. Military shoppers are not shouldering that cost directly. Congress itself mandated as much in 10 U.S.C. §1065, when it expanded commissary access to new veteran groups in 2019 – any “user fees” for credit card use were designed to reimburse Treasury, not charge individuals extra.
DCUC’s position is clear: the government should continue covering these transaction costs in recognition of our heroes’ service. The notion that a new study is needed to calculate or reduce “fees imposed” on veterans is a red herring – those fees are already absorbed by the government. The real impact of slashing interchange would be to save money for large merchants, not for military families at the checkout line. Let’s not pretend this is about easing anyone’s grocery bill at the base commissary. It’s about certain companies trying to pay less to process card payments, even if that means undercutting the system that protects consumers and fuels the card benefits servicemembers rely on.
Invading Privacy Under The Pretext Of A Study
Beyond its false premise, the proposed study raises serious privacy concerns. To “study” interchange fees paid by specific categories of veterans, one would need to gather and analyze transaction data on those individuals’ card use at commissaries. That means accessing sensitive consumer data at the individual level – a slippery slope that current industry rules forbid. Under payment network rules and Payment Card Industry (PCI) compliance standards, merchants and processors are not allowed to access or retain personal cardholder data (names, addresses, account numbers) beyond what’s essential to complete transactions. Only limited, tokenized information travels with a card swipe or chip dip; granular data tying purchases to specific veterans is not readily available for a reason.
For the Defense Department to reach in and extract that data, it would likely need to bypass or violate established privacy safeguards. DCUC noted that such an effort “will need proper banking committee oversight if it seeks to invade the privacy of these veteran consumers”. In other words, a defense authorization bill is the wrong place to authorize data snooping on military families’ spending habits. For Congress to mandate this in an NDAA rider – without the scrutiny of financial privacy experts – is irresponsible. Our wounded warriors and veterans should not have to sacrifice their privacy so that a predetermined report can be generated to serve a political agenda.
Predetermined Conclusions, Zero Benefit To Military Families
The very title and framing of the Marshall – Durbin amendment’s study telegraphs a predetermined conclusion. It starts with the assumption that interchange “user fees” on veterans are a problem to be solved – and unsurprisingly, it would conclude that cracking down on those fees (i.e., resurrecting the CCCA’s price controls) is the solution. This isn’t unbiased fact-finding; it’s advocacy research at best. Members of Congress and their staff should see this for what it is: the answer has been decided before the study even begins.
And even if interchange fees were slashed as the CCCA proposes, would military families see any savings? History says no. When Congress capped debit card interchange in 2010 (the Durbin Amendment), retailers enjoyed lower processing costs – but consumers didn’t see price reductions at the register. In fact, no one even monitors whether those savings are passed on. We caution that “nothing in the proposed [CCCA] indicates things will be different for credit cards”, and that consumers continue to lose out. The promised price relief for servicemembers is an illusion. Commissaries and exchanges would not be required to cut prices or give better terms to veterans if their card fees went down.
So who would benefit? Follow the money – reduced interchange means large merchants pad their profit margins. A coalition of community banks and credit unions noted that this plan would “solely benefit big-box merchants such as Amazon and Walmart” while robbing military families of their card rewards and undermining data security. In other words, Main Street military consumers get nothing – or worse – while Wall Street and corporate retail get a windfall. That outcome is unacceptable, and it’s certainly not something Congress should facilitate under the banner of supporting our troops.
Cheaper Networks = Higher Fraud Risk And Fewer Rewards
What would these interchange caps and routing mandates mean on a practical level? They would force credit card transactions over to cut-rate processing networks that offer bare-bones security and benefits. Right now, when a servicemember swipes their credit union’s Visa or Mastercard at the commissary, they benefit from robust fraud protection (zero-liability policies, advanced fraud monitoring) and perhaps cashback or rewards points. These services are funded by interchange – the small fee that merchants pay per transaction. If the government imposes price controls or routing rules to drive that fee down, the likely result is transactions being routed through “least-cost” networks that have underinvested in security and consumer protections. Many of these alternate networks are “less secure, less reliable” and do not provide the suite of rewards and protections that military cardholders currently enjoy.
In practice, a purchase that today might go over a well-tested network with fraud guarantees could tomorrow be forced onto a network with weaker cyber defenses – all to save a retailer a few pennies. Those pennies saved come at the cost of higher fraud exposure to the cardholder and the financial institution, and loss of any rewards that interchange funds. Essentially, military families would pay more in fraud and receive less in benefits. That is an untenable trade-off. Congress should not push our servicemembers to use cut-rate payment pipelines that could fail them when fraud or errors occur. Especially not when the current system has served military consumers well with virtually zero-cost fraud liability and valuable rewards funded by interchange revenues.
The Wrong Answer: An Unregulated Government-Issued Card
If the goal is truly to minimize commissary transaction costs, some might argue: why not have the Defense Commissary Agency issue its own credit card for veterans to use, similar to the military exchanges’ MILITARY STAR card? Indeed, the Army & Air Force Exchange Service (AAFES) runs a proprietary credit program that avoids traditional interchange fees. But that path is even more dangerous for servicemembers and veterans. These government-issued store cards operate outside the normal regulatory framework that applies to commercial credit cards. They are not under the oversight of the Consumer Financial Protection Bureau in the same way, nor must they conform to all provisions of the Truth in Lending Act or Fair Credit Billing Act as a typical bank-issued card would. The results can be troubling: Servicemembers who fall behind on a military exchange card don’t just face a hit to their credit score – they effectively owe a debt to the federal government, which can trigger draconian collection tools like the Treasury Offset Program (garnishing tax refunds or other federal payments). No private credit card company has the power to sic the U.S. Treasury on you to collect an overdue grocery bill, but a government-administered card could do exactly that.
Additionally, these in-house cards can pile on fees and interest without the same market pressures or regulatory caps that credit unions and banks adhere to. While the exchanges tout lower APRs in good times, there is nothing preventing rates or penalties from climbing, and users have limited recourse to independent regulators or courts when disputes arise. In short, pushing military shoppers onto a government-run credit card to avoid interchange is a cure far worse than the disease. It would move our veterans into an unregulated credit system with fewer protections and potentially harsher consequences – an outcome completely at odds with protecting the financial well-being of military families.
Keep Exploitation Out of the NDAA
Our men and women in uniform – and those who have earned honors through blood and sacrifice – deserve better than to be used as bargaining chips in a retailer-led crusade against interchange fees. DCUC and the entire military banking community stand firmly against this exploitative amendment.
This proposal will not reduce grocery prices for military families, not enhance their benefits or security, and not respect their privacy. What it will do is hand a victory to powerful lobbyists at the expense of those who have served. Such a measure has no place in the NDAA or any must-pass legislation. We urge Congress to see through the façade and reject this amendment. Keep the focus of the NDAA where it belongs – on strengthening national defense and supporting our troops – not on advancing unrelated financial agendas that undermine the very people our defense community exists to serve. Our nation’s heroes have earned our respect and gratitude, not to be exploited for political gain. It’s time to stand with them and stand up to the special interests by saying no to this cynical “swipe fee” study once and for all.
Jason Stverak is Chief Advocacy Officer at the Defense Credit Union Council.