Visa and MasterCard bow to EC on cross-border MIF rates

Visa and MasterCard bow to EC on cross-border MIF rates

Visa and MasterCard have bowed to pressure from the European Commission and agreed to publish the fees charged to banks for processing cross-border payments on behalf of retailers.

The move is expected to help retailers in their negotiations with banks over charges levied against card use for non-domestic cardholders.

In accordance with an EC ruling in July 2002, Visa had already allowed its member banks to reveal information about the multelateral interchange fee (MIF) levels for consumer cards. However, merchants had repeatedly complained to the Commission that their banks are reluctant to give full information on the MIF.

Visa has now published its MIF charges and cost components on its Web site and Mastercard has confirmed that it plans to follow suit.

The European Commission - which has been investigating Visa and MasterCard fees under competition law - welcomed the move as a further step towards increased transparency in cross-border payments processing, but warned the card companies that it will continue to monitor progress.

The Commission says that recent investigations have shown that the payment cards technology develops very fast and that the rules governing transactions remain of continued relevance to retailers and consumers.

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