Visa interchange fees anti-competitive, watchdog says
(25 October 2005 – UK) British consumer watchdog The Office of Fair Trading (OFT) has said interchange fees being charged by Visa members for processing card transactions are anti-competitive.
This follows the OFT pointing the finger at MasterCard back in September over a collective agreement among its members which set the interchange fees on purchases made between March 2000 and November 2004.
At the time, OFT chairman John Vickers described the fees as a "tax on UK consumers".
Most of the major banks are MasterCard and Visa members.
The OFT said the cost of fees being paid by merchant acquirers to issuing banks on Visa and MasterCard transactions was "unduly high".
"The cost of these fees is passed on to retailers and ultimately to consumers," the OFT said.
MasterCard is appealing against the ruling, saying fees collected have helped boost technology platforms and security.
At the time, OFT chairman John Vickers described the fees as a "tax on UK consumers".
Most of the major banks are MasterCard and Visa members.
The OFT said the cost of fees being paid by merchant acquirers to issuing banks on Visa and MasterCard transactions was "unduly high".
"The cost of these fees is passed on to retailers and ultimately to consumers," the OFT said.
MasterCard is appealing against the ruling, saying fees collected have helped boost technology platforms and security.
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