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Friday, Dec 01, 2023

British, American Retailers Join Court Battles Against Visa, MasterCard Over Transaction Fees

British, American Retailers Join Court Battles Against Visa, MasterCard Over Transaction Fees

Earlier, the e-commerce giant, Amazon stopped accepting payments from Visa cards in the UK citing "high fees" of the financial services corporation. Visa condemned the decision accusing the company of "restricting consumer choice".

Several global fashion retailers have filed legal complaints against the world's two major financial services companies over their fees for card payments. Among them are UK-based AllSaints and Superdry, as well as American Levi, The Telegraph reported citing UK High Court writs.

The companies reportedly accuse Visa and MasterCard of breaching competition laws with their high fees, and seek compensations for their losses. The fashion retailers thus joined around a dozen companies that seek to hold the two global credit cards operators accountable for high fees. Among other complainants are British supermarket chains Asda, Morrisons and Sainsbury’s.

One of them, Sainsbury’s, reportedly reached an out of court settlement with MasterCard, but continues litigation against Visa. The latter rejects claims for compensations for high fees.

"Visa considers all claims relating to interchange to be without merit and will be vigorously defended".

MasterCard, in turn, suggested that complainants benefited greatly from the services the company provides for the card holders and suggested that the retailers should adapt their businesses to deal with ongoing economic challenges.

"We firmly believe that retailers of all sizes derive real value from our network and we are committed to supporting our retail partners to adapt and grow their businesses through this challenging time," MasterCard said in a statement.

The series of lawsuits follows a major conflict between Visa and the e-commerce giant Amazon. The US company recently announced that it will stop accepting payments from Visa cards issued in the UK citing "high fees". The e-commerce giant challenged Visa's practice of charging additional fees for protection against fraud, since the company has its own mechanism of combating it. Amazon apologised for the inconvenience and offered its customers discount coupons for their next purchase with another payment method.

Amazon also said it is considering dropping out of a joint project with Visa that issued co-branded cards in the US.

Visa condemned Amazon's decision as "odd" and "unfortunate", accusing the e-commerce giant of "restricting consumer choice".


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