Today's story calls out Visa for using fees to dominate the market at the expense of merchants
Indianapolis, Jan. 5 /PRNewswire/ -- Robert Johnson, President of Consumers for Competitive Choice (C4CC), issued the following statement in response to Andrew Martin's front page story in today's New York Times titled, "The Card Game: How Visa, Using Card Fees, Dominates a Market:"
"I am pleased that the New York Times is drawing attention to the issues of debit card steering and interchange fees, or swipe fees -- two of the many methods that Visa has been using to line their pockets on the backs of small businesses and consumers for far too long. What this article makes abundantly clear is that the most important thing to card companies like Visa is their bottom line -- at any cost! Is there any other industry where we put up with practices like this?
"As the article points out, not only do signature debit purchases cost twice as much as PIN debit purchases for retailers, but PIN debit cards are less vulnerable to fraud making them a safer choice for card carrying customers. Yet Visa, MasterCard and others continue to steer customers toward signature debit purchases, even going so far as offering glittering prizes that customers only qualify for by making signature debit purchases. Why? I think that answer is clear ... because at the end of the day it means higher profits for big banks and Visa and MasterCard. It is truly disgusting.
"Small businesses have long been willing to pay their fair share with regard to interchange fees, but as the article makes clear, debit purchases were somewhat fee neutral until visa changed that in order to incentivize big banks to issue more credit cards. It is this greed that has led to an escalation of over 300% in interchange fees since 2001, resulting in interchange revenue that has increased to $45 billion today. These fees are excessive and reasonable reform is absolutely necessary.
"I hope that by highlighting these bad business practices, and the perverse form of competition that has been taking place in the credit card industry -- on the basis of raising prices as opposed to lowering them -- Congress will take swift and appropriate action, and immediately address interchange fees. Small businesses and consumers have been unfairly bearing the burden of the greed that has been prevalent in credit card companies for far too long."
For more information, visit the Credit Card Con website at www.thecreditcardcon.com.
SOURCE Credit Card Con