Leahy: Visa To Publicly Disclose Rules For Merchants
WASHINGTON (Thursday, May 8, 2008) – Two years after the Senate Judiciary Committee held a hearing to examine the fees charged to merchants when they accept a credit or debit card transaction, Sen. Patrick Leahy (D-Vt.) Thursday announced that on May 15, Visa – one of the world’s leading credit card companies – will post online the company’s rules that apply to merchants who accept their cards.
The Judiciary Committee, which Leahy currently chairs, held a hearing in 2006 to explore the effects of interchange fees and the lack of transparency on small merchants. Interchange fees are at the center of charges assessed to businesses large and small by the banks that facilitate credit card transactions between retailers and consumers. During the hearing, Leahy and others on the panel heard from a fifth-generation Vermonter, Kathy Miller, who is a co-owner of The Elmore Store in Lake Elmore, Vermont. During the hearing, Miller testified about the growing burden of credit card fees on small, independent businesses.
Shortly after the 2006 hearing, MasterCard made its rules available to the public. Visa has announced it will make all its operating rules publicly available on the Internet beginning May 15.
“The relationship among merchants, credit card companies and banks needs more transparency,” Leahy said Thursday. “Businesses deserve to know the rules they will be bound by when they sign on to accept certain credit cards. I am pleased that Visa has agreed to make these rules publicly available beginning May 15. Making these rules available is an important and constructive first step. Transparency will make the market function more efficiently. The spotlight we have trained on this issue is helping the situation, and I will examine what rules are actually made public to be sure the complete rules that apply to merchants are available. The complex business relationships that exist in this industry, the and clout of credit card issuers, and the potential for abuse all merit continued and careful monitoring.”
Historically, the rules that payment companies such as Visa and MasterCard require banks and retailers to follow have been hidden from the public view, leaving retailers and consumers in the dark. Leahy has been a longtime advocate for transparency between credit card companies, banks and merchants.
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