Mastercard and Visa pushed back adjustments that would’ve affected merchant card fees.

Here’s what you need to know:

• Both card networks were set to increase merchant card fees for select transactions next month. In February, it was reported that Mastercard and Visa would increase merchant credit card fees this April for card-not-present transactions, including online payments. But they’ve now decided to push back these adjustments until April 2022, the second delay since the onset of the coronavirus pandemic: Last year, Mastercard and Visa forwent planned fee adjustments in response to the crisis.
• Legislators pushed back against the hikes, citing the need to support economic recovery. Senate majority whip Dick Durbin, D-I.L., and Rep. Peter Welch, D-V.T., sent a letter to Mastercard and Visa asking them to hold off on increasing fees. They wrote that “raising fees would undermine efforts to help the economy recover and further reduce Americans’ purchasing power.”

The card fee adjustments are a point of contention because they primarily target ecommerce, which most merchants have relied on throughout the pandemic.

• There’s been a rise in online payments throughout the crisis, driven by a surge in ecommerce. This shift was vital during US lockdowns, when most brick-and-mortar merchants closed temporarily—or permanently—and often operated completely online.
• Many merchants kept their online business going even as lockdown restrictions eased: In June 2020, 27% of US small and medium-sized businesses (SMBs) began selling online for the first time. By January 2021, 43% of them were actively engaged in selling online, according to Visa’s Back to Business study.
• And even as pandemic conditions improve, ecommerce will remain an important sales channel for merchants: More than 40% of consumers say they would not shop in-store more than they currently do after being vaccinated, per a First Sight study cited by CNBC.

But now that fee increases are being delayed, merchants—primarily smaller businesses—have a chance to pocket revenue that may have otherwise gone toward higher card fees. This may help them regain their financial footing, especially as economic conditions recover from the pandemic and make way for increased consumer spending. The delay might have the greatest impact on SMBs, which make up more than 99% of all businesses in the US, because many of them lack the financial resources big businesses have to pay merchant fees. However, card fees will likely remain a point of contention for merchants and be met with pushback when they’re due to rise again next year. But merchants may be in a better financial position to handle card fee increases by next April, when the economic fallout from the pandemic will likely have subsided substantially.