Visa is scheduled to have its IPO later this week. The IPO could potentially be the largest in history. This market seems like terrible timing for an IPO, although for liquidity-strapped
banks, the IPO could be a much-needed source of cash. The Visa IPO, along with the 2006 MasterCard IPO and the end to MasterCard and Visa’s dual-exclusivity rules, which prohibited banks that issued MC/Visa cards from issuing Amex or Discover cards, is setting the stage for a major reconfiguration of the payments world in the next decade. These changes could have far-reaching effects for consumers, merchants, and banks because of potential shifts in the way payment networks will compete with each other
Tag: antitrust
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The Visa IPO
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European Commission Rules MasterCard’s Interchange Fees Are Illegal
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In December, the European Commission antitrust authority, the Directorate General Competition, ruled that MasterCard’s interchange fees are illegal. (I realize it is now mid-January, but I wasn’t blogging when it the ruling came out.) MasterCard is, of course, appealing.
Although ruling this made page 4 of the Wall Street Journal, it has gotten very little attention otherwise in the business or general press. ( The ruling has huge ramifications for consumers and merchants. The underlying issue is technical, however, but well worth understanding.