Law and Race Commons^™

Private Interests, Public Law, And Reconfigured Inequality In Modern Payment Card Networks, Stephen Wilks

Dickinson Law Review (2017-Present)

This Article examines two phenomena contributing to the racial stratification of consumers in credit card markets. The first phenomenon pertains to the longstanding conflict between card issuers and merchants over payment processing cost allocation. If successful, First Amendment challenges to existing statutory surcharge bans will allow merchants to impose an additional fee when consumers use credit cards as a form of payment. The Article relies on the interplay between socioeconomic class and behavioral theory to suggest subsistence borrowers would be more likely to pay surcharge fees than wealthier consumers. This arrangement disfavors the poor to support a hierarchy of borrowers, …