Federal regulators have approved Capital One’s $35 billion acquisition of Discover, a move that will create the largest credit card issuer in the United States and grant Capital One access to Discover’s payments network.
“The combination of our two great companies will increase competition in payment networks, offer a wider range of products to our customers, increase our resources devoted to innovation and security, and bring meaningful community benefits,” Michael Shepherd, interim CEO and president of Discover, said in a statement.
Supporters argue the merger will enhance competition against Visa and Mastercard, potentially lowering payment network fees and spurring innovation, especially as the combined entity will still trail the dominant networks in market share.
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Critics, including members of Congress, contend the deal could reduce consumer choice, create a “megabank,” and result in higher fees for both merchants and cardholders due to increased industry consolidation.
“President Trump promised to cap credit card interest rates, but his Administration just rubber-stamped the creation of the largest credit card company in the country, which will hurt consumers and small businesses with inevitably higher credit card interest rates, increased junk fees, and reduced availability of credit,” Senator Elizabeth Warren, the ranking member on the Senate Banking Committee, said in a statement. “Today Wall Street initiates the newest member of its Too-Big-To-Fail club at the expense of working Americans and our nation’s financial stability—a daily theme of the Trump Administration.”
President Trump promised to cap credit card interest rates, but his Administration just rubber-stamped the creation of the nation's largest credit card company––meaning higher interest rates and junk fees.
Another win for Trump's Wall Street friends at the expense of consumers. https://t.co/7fqzsFIvge
— Elizabeth Warren (@SenWarren) April 18, 2025
Some analysts believe the regulatory approval signals a softer approach to bank mergers under the current administration, potentially paving the way for further consolidation in the financial sector. While immediate changes for Capital One and Discover cardholders are unlikely, future adjustments—such as card network transitions—could affect acceptance and benefits, especially outside the U.S. The debate continues over whether the merger will ultimately benefit consumers by injecting competition or harm them by limiting options and raising costs.
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