Wednesday, July 19, 2006

First Ever U.S. Senate Hearing On Interchange Today (

After years of discussion and international debate, the focus of illegal price-fixing by the banks which controlled the two largest credit card associations shifts to Washington D.C. Today, the U.S. Senate Judiciary Committee hearing will draw attention to this issue. Regulators in Europe, Australia and other nations have been addressing this multi-billion dollar issue and today the U.S. enters the spotlight too.

Few merchants or consumers understand how this hidden interchange tax works. Questions of why the fees continually rise, even though technology in other industries forces costs down while improving efficiencies. Retailers have no voice in the collusive price-fixing waged by Visa® and MasterCard® which own 85% market share.

The Senate hearing was called for by a bipartisan committee which included Sen. Arlen Specter, R-Pa., and Sen. Patrick Leahy, D-Vt.. The lead question is whether Visa® and MasterCard® violated antitrust laws by setting these interchange charges by agreement.