The recent drop of 2.7% is due to the lawsuit between
Walmart and Visa Inc. Walmart has sued Visa Inc. for a total of $5 billion USD.
This is with regard to a allegedly high amount of card swipe fees taken by Visa
during the various retail transactions of Walmart. There was no immediate
response from Visa Inc. for this lawsuit. This case is based on strong
precedent set by the $5.7 billion settlement Visa and MasterCard agreed in a
class-action regarding the same matter. Meanwhile, Walmart has announced that
it will switch its branded cards from Discover to MasterCard. This is a win for
MasterCard and a missed opportunity for Visa Inc. In addition, Visa Europe is
expected to slice down the rate that it charges for card transactions in
Poland. It is also known as the interchange rate.The increase has been done of
0.5%, from 1.2 to 1.3 percent. The reduction will be effective from 1st
of July. As more and more retailers seek direct entries into the mobile payment
industry, big retailers no longer want to share as much of their thin profit
margins in paying electronic-transaction fees. They see mobile-based digital
wallets as a way of circumventing Visa and its peers to keep more of their
revenue for themselves.
In the Russian side, the suspension has been withdrawn,
Russia has decided to have its own domestic payment system within six months to
become more self dependent in the future. It is hard for Russian to start a new
payment system, since Visa and MasterCard hold the lion’s share of plastic card
market in
Russia.So
it seems difficult for Russia’s planned domestic payment service to compete
against these card giants.
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