Visa & Mastercard Hit With $52M In Fines After Ripping Off Disadvantaged
As Australian retailers sign up to new payment methods such as Zip and AfterPay traditional credit card providers Visa and Mastercard who have been hitting retailers and consumers with high transaction fees for decades have been accused of running a cartel to reduce competition in the market for pre-paid cards.
In the UK, several providers including Mastercard and Visa ran schemes that have been deemed as being designed to target disadvantaged people.
The UK Payment Systems Regulator claims that for six years, the firms agreed not to poach clients or compete for bids.
Mastercard and two others have admitted involvement and agreed to pay fines of up to A$52M.
The BBC said that the schemes were designed to help local Councils provide pre-paid cards for vulnerable people such as asylum seekers, the homeless and victims of domestic violence.
Mastercard ran the payment systems and funded a forum where the card providers met potential clients – and each other.
It alleges that from 2012 to 2018 the card providers agreed not to try and poach each other’s clients or compete when bidding for local authority contracts.
In Australia retailers are now putting hidden Visa and Mastercard fees on bills.
Consumers who pay for a $4.50 cup of Coffee and pay using a bank issued Visa or Mastercard are finding an additional charge added to the bill when the transaction goes through. ChannelNews understands that tap and go machines are now being programmed to add the additional charges which in many cases are not advertised by a retailer.