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US Probe Into Visa Widens

An investigation into alleged anti-competitive practices with debit cards by Visa is gathering momentum with the financial giant being ordered to supply more information and documents.

Visa this week disclosed that the US Department of Justice had asked for the information as part of an ongoing anti-trust probe into different facets of the payments giant’s operation.

On the one hand, there’s Visa’s 2020 acquisition of fintech company Plaid which had planned to build a competing payments network.

In 2020, the Department of Justice took Visa to court over the deal.


“Visa’s monopoly power in online debit is protected by significant barriers to entry and expansion,” the department said in a 2020 court filing to the US District Court in San Francisco.

“Visa is a monopolist in online debit transactions, extracting billions of dollars in fees annually from merchants and consumers. Plaid, a financial technology firm with access to important financial data from over 11,000 U.S. banks, is a threat to this monopoly: it has been developing an innovative new solution that would be a substitute for Visa’s online debit services,” the filing said.

Concern goes beyond acquisitions to broader practices Visa may have used to freeze out the competition. One is alleged steering arrangements with PayPal to stop consumers from paying with their cheque accounts in the US instead of debit and credit cards when using PayPal, pymnts.com reports.

Another is whether Visa is pursing similar practices exposed in another Department of Justice antitrust case settled in 2010. It involved barring merchants from suggesting that their customers use lower-cost debit and credit cards, the publication says.

The current probe is looking at a similar practice – “whether Visa prevented retailers from sending debit card transactions through lower-cost card networks,” pymnts.com reports.

Visa, in a court filing, revealed the new request for information.

“On January 4, 2023 and May 2, 2023, the Antitrust Division of the U.S. Department of Justice (Division) issued further Civil Investigative Demands seeking additional documents and information focusing on U.S. debit and competition with other payment methods and networks. Visa is cooperating with the Division in connection with the investigation.”

The court document said a probe by the European Commission into its staged digital wallets had been settled in February 2023.There is ongoing litigation in Germany over ATMs, and separate litigation to do with the EMV security chips on modern debit/credit cards.

Visa’s biggest rival Mastercard this year was dragged into the investigation on whether it, too, breached antitrust rules.

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