WASHINGTON, D.C. -- The Merchants Payment Coalition is pointing to price fixing by Visa Inc. and MasterCard Inc. as the driving force behind high swipe fees on credit credits.
In a new document made available to its members this week, the coalition said that even though banks set their own prices on every other fee and rate they charge, they each agree to charge the same swipe fees in concert with Visa or MasterCard. The group also alleges the banks hide "their swipe fee price-fixing scheme" from consumers.
Swipe fees for both credit cards and debit cards have been a hot button issue for several years -- pitting the retail industry against financial institutions. Credit card swipe fees have been the center of a seven-plus-year class action suit which is nearing a settlement this fall. Debit card transaction fees became the focus of an intense lobbying battle in Washington, D.C. in 2011, as CSNews Online previously reported.
Last week also marked the seventh anniversary of the first congressional hearing on swipe fees before the House Energy and Commerce Committee's Subcommittee on Commerce, Manufacturing and Trade.
According to Kantor,
- Merchants don't know what the fee will be when a customer swipes a credit card until they get their bank statement. There are more than 240 different fees, depending upon the type of card and the merchant accepting it.
- The banks that issue cards are Visa and MasterCard's customers, not the consumers who use the cards.
- Merchants paid banks more than $30 billion last year in credit card swipe fees.