US DOJ Accuses Financial Giant, VISA, Over Monopoly of Debit Card Market
2 years ago 2 min read
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The US Department of Justice (DOJ) has filed an antitrust case against Visa, arguing that the business has an illegal monopoly on the usage of debit cards in the United States.
It claimed that Visa had punished companies that wished to use alternative payment networks while also paying off potential competitors to maintain its market dominance.
The DOJ stated that the actions had hindered innovation and resulted in large higher fees for American consumers and businesses.
As of now, Visa controls the majority of debit transactions in the United States, making it difficult for alternative networks to compete.
The agency claimed that Visa has used its power to hinder competition and maintain higher merchant prices.
“While Visa is the first name many debit card users see when they take out their card to make a purchase, they do not see the role that Visa plays behind the scenes,” Attorney General Merrick Garland told reporters.
“There, it controls a complex network of merchants, financial institutions and consumers” and behaves as a “monopolist” that “is charging a hidden toll on trillions of transactions,” he added
In response to the charges, Visa’s general counsel, Julie Rottenberg, stated that the business is committed to maintaining a competitive environment.
She described the action as without merit, emphasising that Visa’s appeal among businesses and customers stems from its secure network and excellent fraud prevention.
Newsng understands that the action is part of the Biden administration’s efforts to address rising consumer prices, which have become a major political issue ahead of the 2018 presidential election.
Visa claimed the charges were “meritless” and that it would defend itself in court.
“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,” she said.
“This lawsuit is meritless, and we will defend ourselves vigorously.”
We earlier reported that in a historic civil antitrust case, the DOJ accused tech giant, Apple, of stifling competition to increase profits and unlawfully monopolise the US smartphone market.
