Followers

December 15, 2010

VISA and MasterCard ripping off consumers

CANADA - VISA and MasterCard are ripping off both businesses and consumers due to “restrictive” and “anti-competitive rules” on merchants that add up to $5 billion CDN / year just in Canada alone, according to a report by Canada’s competition watchdog.

Canada's federal bureau of competition policy has asked the Competition Tribunal to strike down the credit card rules (essentially making them free), which it argues effectively eliminates competition between the two multinational credit card giants. The rules (which are identical for both VISA and MasterCard) is effectively a monopoly on credit card lending and overcharges businesses for the right to accept credit cards in their stores.

The costs to businesses ends up being passed on to consumers, resulting in an approx. 3% hidden 'credit card' tax on all purchases. Canadians used their credit cards for $240 billion worth of purchases in 2009.

Globally VISA and MasterCard handled approx. $6.5 trillion USD in transactions in 2009. Together they represent 90% of the global credit card market.

For businesses who accept these cards, the rules result in an “increased costs to business and ultimately consumers”...
“Visa and MasterCard's anti-competitive behaviour hurts businesses and consumers alike,” said commissioner Melanie Aitken. “It is particularly harmful for small and medium sized businesses, key engines for economic growth in Canada. Without changes to the rules, merchants will continue to face high costs for credit card acceptance, while consumers, even those who use lower-cost methods of payment like debit or cash, will continue to pay higher prices.”
Businesses are in favour of scrapping the unfair fees, pointing to the credit card industry's billions of annual profits.

Politicians looking to cut back on household debt in Canada (Canadians now have more household debt than Americans) need to focus on regulating the credit card and banking industry.

No comments:

Post a Comment

Comments containing links will be marked as spam and not approved. We moderate every comment. If you want to advertise on this blog it is $30 per link.

Affordable Website Design & SEO

Looking for a quality professional website designer? Why not go where the smart money is?! Toronto Website Design and Toronto SEO. Get free SEO advice from people who really know the business.

Featured Posts

The Sarcasm Symbol
Ever had some confusion online or with your cellphone when someone fails to catch the sarcasm? Well now with the SarcMark you can ge...
Behold, the Scorpion Hydrogen Supercar
CARS - To the right is the future of supercars... it is a hydrogen supercar called the Scorpion. The Scorpion from Ronn Motors in Texas is t...
Documents show Stephen Harper misusing public funds
CANADA - According to 950+ pages of documents obtained by the Canadian Press under the Access to Information Act the Privy Coun...
Pink's Rosie the Riveter
ENTERTAINMENT - What I like about this video is how it meshes different social movements like feminism, veganism, anti-capitalism...
California's Dustbowl
ENVIRONMENT - The photo on the right is a farm in California that has been put up for sale. Its just one of thousands of farms that are n...
Is Steampunk the New Goth???
GOTHIC - Watch out what you see on the subway late at night because while in 2001 you might have seen some pretty freakish goths, by 20...
Do you have enough Ice Water in your diet?
HEALTH - A Calorie (large C) is a measurement of the amount of energy needed to raise the temperature of a litre of water (1 kg's worth) ...
North Korean timeline towards Inevitable War
POLITICS - The following is timeline of events that have occurred on the Korean Peninsula. 1945 - Japan surrenders to the United States a...
Judgment Day is Tomorrow, so sayeth Cult
RELIGION - According to a cult based in California, Judgement Day is tomorrow (May 21st 2011) and Jesus Christ will return to the Earth a...
Sex in Space Forbidden
SEX/TECHNOLOGY - Sex in outer space is a big no-no according to NASA. Not for professional astronauts at least, but the growing numb...

Popular Posts