MasterCard to Disclose Interchange Fees
NEW YORK -- Following numerous anti-trust lawsuits against the fees credit card companies charge merchants, MasterCard, the world's second largest credit card company, has announced plans to post its interchange fee schedule as well as put a limit on the fees it charges retailers who accept the cards for fuel purchases, reported Reuters.
"Merchants have told us they [want] additional transparency around interchange rates," Walt Macnee, president of MasterCard, said in a statement.
Interchange fees are a percentage of purchase cost tacked on to every transaction that credit card's banks charge merchants when the card is used. The average interchange fee for U.S. purchases is nearly 1.56 percent, reported Reuters.
"Because of the unique structure of the petroleum distribution business, gasoline retailers are disproportionately affected by high oil prices," Macnee added.
At a Senate Judiciary Committee hearing in July, CSNews Online reported that convenience retailers were struggling to stay open due to rising interchange fees when gas prices were escalating. "We just keep absorbing the fees, trying to survive," said Kathy Miller, owner of The Elmore Store. "We are trying to keep the doors open."
The capped fee for gas retailers will provide benefits to retailers on gas purchases of $50 or more, according to the company. It estimated that interchange fees could be reduced by 21 percent on a purchase totaling $60.
The company's U.S. interchange rate schedule will be posted on its Web site by Nov. 1. However, Reuters reported that it is not known how this will affect current lawsuits filed against the company from retailers -- Kroger and Walgreen Co. -- and associations including NACS.
"Merchants have told us they [want] additional transparency around interchange rates," Walt Macnee, president of MasterCard, said in a statement.
Interchange fees are a percentage of purchase cost tacked on to every transaction that credit card's banks charge merchants when the card is used. The average interchange fee for U.S. purchases is nearly 1.56 percent, reported Reuters.
"Because of the unique structure of the petroleum distribution business, gasoline retailers are disproportionately affected by high oil prices," Macnee added.
At a Senate Judiciary Committee hearing in July, CSNews Online reported that convenience retailers were struggling to stay open due to rising interchange fees when gas prices were escalating. "We just keep absorbing the fees, trying to survive," said Kathy Miller, owner of The Elmore Store. "We are trying to keep the doors open."
The capped fee for gas retailers will provide benefits to retailers on gas purchases of $50 or more, according to the company. It estimated that interchange fees could be reduced by 21 percent on a purchase totaling $60.
The company's U.S. interchange rate schedule will be posted on its Web site by Nov. 1. However, Reuters reported that it is not known how this will affect current lawsuits filed against the company from retailers -- Kroger and Walgreen Co. -- and associations including NACS.