visa and Mastercard Reportedly Near Settlement too Reduce Transaction Fees
Jakarta – Visa (VN) and Mastercard (MA.N) are reportedly close to reaching a settlement with merchants to lower transaction fees, known as interchange fees, according to a report by the Wall Street Journal citing sources familiar with the matter.
The potential agreement would see both companies reduce interchange fees – typically ranging from 2% to 2.5% per transaction – by approximately one-tenth of a percentage point over several years. Merchants would also gain more versatility in accepting credit cards, allowing them to decline certain card types deemed too expensive to process.
Neither Mastercard nor Visa responded to requests for comment from Reuters.
Discussions center around categorizing credit card acceptance, differentiating between options like gift cards, non-reward cards, and commercial cards.
This proposed settlement seeks to resolve a legal dispute dating back to 2005. Last year,a similar agreement resulted in a $30 billion settlement,committing companies to reduce swipe rates by at least 0.04 percentage points over three years and maintain rates an average of seven basis points below current levels for five years.
Both Visa and Mastercard have maintained they have not engaged in wrongdoing while negotiating resolutions to these issues. Merchants have long argued that Visa and Mastercard charge excessive interchange fees and employ “anti-steering” rules that prevent them from incentivizing customers to use cheaper payment methods.
The current settlement talks also reportedly include additional costs.
(clay/clay)
