Expanded investigation into Visa and Mastercard payment processing charges by the European Union
The European Commission's antitrust investigation into Visa and Mastercard's card processing fees has expanded, as regulators seek to delve deeper into the companies' practices and heard from terminal providers, payments companies, and retailers. A new questionnaire has been circulated, pursuing insights on fees, services, and market positioning that could potentially lead to allegations of anti-competitive practices.
The latest questionnaire seeks details on the fees and services billed by Visa and Mastercard from 2017 to 2024, as well as changes and new introductions during this period. The EU's competition enforcer has been paying close attention to mandatory services, the clarity of information provided by the companies, and the notice given for changes or new fees. The authorities also want to understand the complaints handling process and the duration of ensuring grievances are addressed.
Investigators are examining whether retailers and merchants have a genuine choice in accepting Visa and Mastercard as payment options, given the companies' considerable market share. The focus is on the degree of acceptance by various payment service providers and recent increases in fees.
Such an inquiry follows the EU's earlier antitrust actions against the companies, with Mastercard previously being fined €570.6 million in 2019 for inflating card payment costs[1]. The investigation's results could result in substantial fines, price controls, and reforms to improve transparency and competition in the payment sector.
Visa and Mastercard have reacted to the probe, reaffirming the value they provide to fintech institutions, merchants, and consumers in Europe. They emphasized their top-notch security, operational resilience, and fraud prevention measures[2]. Despite the investigation, both companies maintain that their fees reflect the services they deliver.
The deadline for replies to the questionnaire is June 2, and Bloomberg was first to report the circulation of the document[3]. The investigation underscores broader concerns about the EU's reliance on foreign payment providers and the need for domestic alternatives in the sector[3].
[1] - https://ec.europa.eu/competition/antitrust/cases/fin_cases/159389/159389_512768_15_2.pdf[2] - https://www.reuters.com/article/us-eu-visa-mastercard-idUSKBN2XT1M1[3] - https://www.bloomberg.com/news/articles/2023-05-09/visa-mastercard-faces-europe-antitrust-probe-focuses-on-fees[4] - https://www.bbc.com/news/business-57136330
- The European Commission's latest questionnaire regarding Visa and Mastercard's practices asks for details on the companies' fees and services over the period of 2017 to 2024, which could potentially lead to questions about their business practices and competition within the finance industry.
- Investigators are delving deeper into the industry of card processing, scrutinizing the market positioning of Visa and Mastercard and the choices available to retailers and merchants in accepting their payment options, with a focus on the business relationships and potential anti-competitive practices in the global finance sector.
