Debit, Is It Costing Too Much?
Many
merchants think that debit is costing too much and are prepared to
exert significant effort to prove it.
As I have predicted for some time, the merchant world has finally rebelled against the cost of debit. Merchants are also rebelling against Visa's and MasterCard's attempt to replace checks with a more costly payment vehicle.
A group of merchants, led by Wal-Mart, has filed suit against Visa for being forced to accept Visa Debit if they wish to continue to accept Visa Credit Cards. Another merchant group, led by a New Jersey based retailer, has also filed a similar suit against MasterCard.
This trend is following a similar ground-swell effort in Canada, represented by the Canadian Small Retailers Association.
Although Visa has created a lower discount rate for debit than for credit cards, MasterCard rates are the same for both debit and credit, making MasterCard debit 57% higher than the average cost of check guarantee.
