Sunday, June 12, 2005

Solutions to benefit merchants and consumers


1) Prohibit credit card associations from fixing uniform credit card interchange fees.

2) Prohibit credit card associations from enforcing rates that limit merchants' ability to avoid high interchange fees.

3) Permit issuers, acquirers and merchants to voluntarily agree on interchange fees.

4) Discontinue collectively-set interchange fees. (The Visa and MasterCard networks could function efficiently without collectively fixed interchange fees. Even if members of Visa and MasterCard did not fix the interchange fees, the network could continue in their role as clearinghouses between issuing and acquiring banks. There are many examples of similar networks that function very efficiently without collectively-set interchange fees).

5. Please add your comments and suggestions for additional solutions below...