EU Scrutinizes Visa, MasterCard for High Fees

The European Union's top antitrust regulator is fuming over the high fees paid by retailers to Visa and MasterCard.

May 07, 2012

NEW YORK ?" Visa Europe Ltd. and MasterCard Inc. are under scrutiny from the European Union??s top antitrust regulator over fees paid by retailers that he described as "too high," writes Bloomberg.

EU Competition Commissioner Joaquin Almunia said during a conference in Brussels on Friday that there is no indication that card-transaction costs for retailers have decreased since 2006.

"The fees are still too high and too unequal," across Europe, Almunia said. "We are now conducting a study which will give us a better picture of the merchants?? actual costs and benefits of accepting cards as compared to other means of payment."

Regulators are already investigating Visa Europe for the fees it charges for cross-border credit-card and deferred-debit transactions after retailers said the fees were unfair, notes the news source, adding that Visa Europe reduced similar fees for debit cards last year to settle a 2009 EU complaint. MasterCard settled a similar case by the commission in 2009, agreeing to reduce its credit card interchange fees to 0.3% and 0.2% for debit cards.

Visa Europe, meanwhile, commissioned a survey that showed cash payments are "more expensive at the average Visa card transaction value and that Visa Europe??s interchange fees are set at an entirely reasonable level," according to an e-mail from Visa spokesperson Amanda Kamin.

Almunia told reporters that EU regulators are willing to "reconsider" the agreements that capped Visa Europe and MasterCard??s interchange fees, if the EU study could show why card fees for cross-border payments didn??t decline.

Almunia also commented that retailers view card fees "as an excessive tax imposed by banks, since the payment service fee rate can be as high as 2% of the transaction value."

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