Visa Europe agrees to cap inter-bank fee

Visa Europe has decided to cap its inter-bank credit card fees at 0.3% of transaction value for four years, the same level as the rival MasterCard network, to end a European Union competition investigation and stave off a possible fine.

The European Commission said in a statement on Tuesday (14 May) that the proposed reduction meant fees levied by Visa Europe, the European licensee of Visa Inc. that is owned and operated by more than 3,700 European member banks, would be slashed by about 40-60% as a result. The offer is for cross-border and domestic fees.

Visa Europe came under fire in July last year when the regulator said its fees harmed competition between banks and led to higher consumer prices.

Its credit and debit cards account for about 41% of all payment cards issued in Europe, making it the largest card network in the 27-country European Union.

In addition to cutting its fees, Visa Europe also offered to reform its rules, making it easier for businesses to seek better cross-border deals from competing banks.

The EU antitrust authority said those interested in the matter will be able to comment soon on Visa Europe's proposal before it decides whether to accept the offer.

MasterCard, Europe's second biggest credit and debit card network operator, capped its fees in 2009 in response to an EU investigation.

The Commission is set to propose rules on card fees before the summer to ensure a level playing field.

Read more with Euractiv

Austrian coalition split over EU bank secrecy rules

Finance ministers meeting in Brussels today (14 May) will attempt to approve the Savings Tax Directive, which has provoked political infighting in Austria, one of the last countries to hold out against implementing the directive.