No SmartPay for Anti-2A Companies Act

H.R. 100, titled the “No SmartPay for Anti-2A Companies Act,” is a narrowly drafted yet potentially far‑reaching procurement bill that targets how the federal government chooses its charge card and payment vendors. The General Services Administration’s (GSA) SmartPay Program is the government-wide purchasing, travel, and fleet card system used by virtually every federal agency to buy goods and services, book travel, and manage expenses. This bill would bar the GSA Administrator from awarding any new SmartPay contracts to a commercial payment system if that system uses a “payment processing agency” that has implemented a merchant category code (MCC) for gun retailers. The prohibition applies prospectively; it does not unwind or alter any contracts awarded before enactment. The policy backdrop is the recent debate over creating a specific MCC for firearm and ammunition retailers. MCCs, standardized under ISO, categorize merchants by type (e.g., grocery stores, hardware stores) and are widely used by payment networks for risk management, fraud detection, and analytics. In 2022, ISO approved a distinct MCC for gun retailers, after which the major card networks initially signaled accommodation but then paused implementation amid political and legal pushback. Proponents of the MCC argue it could help banks and payment networks spot suspicious transaction patterns potentially linked to firearms trafficking, straw purchases, or preparations for mass violence, akin to how unusual patterns in other merchant categories can help flag money laundering or fraud. Opponents contend it enables targeted surveillance of lawful gun purchasers, risks stigmatizing a constitutionally protected industry, and could become a de facto registry or basis for “de-banking.” H.R. 100 takes the latter view and leverages federal procurement to shape private-sector behavior. By declaring that GSA may not award SmartPay contracts to any commercial payment system that uses a processing agency that has implemented the gun‑retailer MCC, the bill creates a bright-line eligibility test for future federal charge card providers. The language is broad: it does not require that the MCC be used in connection with federal transactions, only that the payment processing agency has implemented it at all. Nor does the bill define “payment processing agency,” potentially encompassing card networks (Visa, Mastercard, Amex, Discover), acquirers, processors, or issuing banks—any one of which, if deemed to have “implemented” the MCC, could render the entire system ineligible. Practically, the measure could narrow the pool of eligible SmartPay vendors if the major networks or their processors proceed with MCC implementation due to business decisions or compliance with state laws. That introduces operational and fiscal risk for the federal government: fewer bidders often means less competition, potentially higher costs, and more concentrated operational risk. If all major networks have implemented—or resume implementing—the MCC, GSA might face difficulty awarding new SmartPay contracts without legislative or regulatory clarification. While existing contracts are grandfathered, renewal cycles and program expansions could be affected. The bill also sets up a federal-state policy clash. Several Republican-led states have passed laws discouraging or prohibiting use of the firearms MCC on privacy grounds, while some Democratic-led states (notably California) have moved to require or encourage its use to enhance public safety monitoring. H.R. 100 would effectively penalize vendors that comply with the pro‑MCC mandates of certain states, pressuring nationwide payment systems to choose between eligibility for federal business and compliance with those state rules. That tension could invite litigation or create compliance fragmentation across jurisdictions. From a civil liberties lens, supporters will frame the bill as preventing financial surveillance of lawful purchases and preempting corporate activism aimed at a constitutional right. Critics will argue the bill undermines established financial crime detection tools and politicizes procurement by punishing neutral risk-management practices. Notably, an MCC by itself does not itemize purchases; it flags merchant category, not specific items or transaction contents. However, sustained use of such codes can facilitate pattern analysis that proponents of the MCC say is vital for suspicious activity reporting, and opponents say is ripe for misuse. In sum, H.R. 100 is a straightforward prohibition with complex ripple effects. It seeks to use federal purchasing power to deter payment companies from implementing a firearms retail MCC. The immediate effect would be to constrain GSA’s future vendor options to those whose processors have not implemented the code. The longer-term effects include potential cost and operational impacts on SmartPay, a sharpened conflict between federal procurement policy and divergent state laws, and a broader signal about Congress’s willingness to condition federal contracts on private firms’ stance toward firearms-related business practices. The bill fits within a wider Republican effort to counter perceived “financial deplatforming” of gun-related commerce, and it will likely draw Democratic opposition centered on public safety, competition, and good‑government procurement principles.