9/25/2024 4:24:05 AM
(MENAFN) The US Justice Department has initiated an antitrust lawsuit against Visa, claiming that the financial services giant leverages its size and dominance to suppress competition in the debit card market, resulting in billions of dollars in losses for consumers and businesses.
The lawsuit submitted on Tuesday states that Visa, based in San Francisco, penalizes merchants and banks who don’t utilize its personal payment processing technology for debit transactions, despite the availability of alternatives options. Visa collects an additional fee from every transaction made on its own network.
Based on the DOJ’s complaint, 60 percent of debit transactions in the US are processed on Visa’s debit network, permitting it to charge more than USD7 billion in fees every year for processing those transactions.
“We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market,” stated Attorney General Merrick B. Garland in a declaration. “Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service. As a result, Visa’s unlawful conduct affects not just the price of one thing – but the price of nearly everything.”
In a declaration, Visa’s general counsel, Julie Rottenberg, stated that the lawsuit doesn’t take into consideration the “ever expanding universe of companies offering new ways to pay for goods and services.”
“Today’s lawsuit ignores the reality that Visa is just one of many competitors in a debit space that is growing, with entrants who are thriving,” Rottenberg declared. She further mentioned that the lawsuit is “meritless” and the firm will protect itself “vigorously.”
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