Today I sat down and read through all of the testimony and must admit, understanding the concepts of interchange, I am troubled by the testimony provided by both Visa and MasterCard. Neither provided sound arguments to justify interchange. Whereas those opposed, clearly demonstrated that Interchange benefited the large issuing banks at the expense of the merchant and consumer. The only testimony that offered any sound support for interchange was that offered by John Blum. Yet his arguments simply argued that without a fixed interchange structure smaller players would not be able to play, which does suggest the interchange mechanism, as a competitive process, is flawed.
Regulation is not the answer. Yet, something must be done to assure that there are sufficient free market forces surrounding the calculation of the default Interchange rates.
Witness list and links to their statements
|Thomas L. Robinson
Vice President of Reglations
National Association of Convenience Stores
|Joshua R. Floum
General Counsel and Corporate Sec.
Constantine Cannon, LLP
Chief Payment System Integrity Officer
Vice President of Operations
Consumer Program Director U.S. PIRG