Visa Faces Antitrust Lawsuit Over Alleged Monopoly Practices
The civil antitrust lawsuit accuses Visa of unlawfully maintaining a monopoly in the debit network market by leveraging its dominance to stifle existing competitors and hinder the emergence of innovative alternatives.
Currently, Visa processes over 60% of debit transactions in the U.S., allowing the company to collect more than $7 billion annually in transaction fees.
The complaint suggests that Visa fortifies its monopoly by shielding itself from competitive pressures. The Department of Justice (DoJ) asserts that Visa uses its substantial influence and central role in the debit ecosystem to enforce a series of exclusionary agreements with merchants and banks.
These agreements penalize clients who attempt to use different debit networks or alternative payment systems.
Furthermore, the lawsuit claims that Visa suppresses smaller competitors or coaxes them into partnerships. In 2020, the DoJ halted Visa’s planned $5.3 billion acquisition of fintech firm Plaid, arguing that it would eliminate a potential competitive threat to Visa’s operations.
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Attorney General Merrick Garland stated, “We contend that Visa has illegally gained the ability to impose fees that far exceed what would be charged in a competitive market. Merchants and banks pass these costs onto consumers through higher prices or diminished quality and service. Consequently, Visa’s unlawful actions impact not just one product’s price but the costs associated with a wide array of goods and services.”
In response, Visa announced its intention to fight the lawsuit in court. Julie Rottenberg, the company’s general counsel, remarked that “Anyone who has made an online purchase or shopped in-store knows that there is a growing range of companies providing new payment methods. Today’s lawsuit overlooks the fact that Visa operates within a competitive debit landscape, which is expanding with new, successful entrants.”
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
