Creates the interchange fee restriction act prohibiting interchange fees on sales and use tax or excise tax when payment is made with a credit or debit card.

Rhode Island Interchange Fee Restriction Act – Plain English Summary

When you pay for something with a credit or debit card, the business accepting your payment pays a small percentage fee — called an interchange fee — to the bank or card network (like Visa or Mastercard) that processed the transaction. This fee is typically calculated on the total amount charged, which includes any sales tax, excise tax, or other government taxes built into the price. This bill would prohibit card networks and banks from charging interchange fees on the tax portion of a transaction, meaning the fee could only be applied to the actual price of the goods or services — not the tax amount collected on behalf of the government.

The businesses most directly affected would be retailers, restaurants, gas stations, and other merchants who accept card payments and currently pay interchange fees on the full transaction total, including taxes. Since businesses don't keep the tax money — they collect it and pass it along to the state — supporters of this idea argue it is unfair for them to pay a processing fee on money they never actually earn. Under this bill, merchants could see modest reductions in their card processing costs, which could potentially translate to savings passed along to consumers.

This bill is currently in its early stages — it has been introduced in the House Corporations Committee and scheduled for a hearing in March 2026, but the committee has recommended it be held for further study, meaning no final vote has been taken yet.