This is for bank to bank transfers, like ACH but different. It won't be used for retail payments directly, though it could make them cheaper in the long run.
Depending on the implementation, I could use them for retail transfers though, if I trust the other party enough. It might not be wise in most cases, due to lacking the protections of credit cards, but it could be in some.
If you read carefully they clearly are not disrupting anyone’s gig. This is America man, the a public instruction isn’t going to step in and eat their business alive especially not something as big as payment processing. This is Zelle 2.0, ACH 2.0, etc. It won’t ever be for payments.
Given the numbers they quote re: cashless payment, it doesn’t matter if retailers don’t like the credit card processors. Consumers do - and with all the points and rewards and convenience of cashless payment, they will demand they at least support such payments and most people will use them even with passing on the fees. It’s hard for me to see a world where that changes any time soon.