Argentina: Regulator strikes – Up to $10 million fine on VISA

Argentina’s National Commission for the Defense of Competition (CNDC) has released a report stating that Prisma – the local operator for the VISA brand – enjoys a “dominant position” and has furthermore engaged in “cartel practices” in the credit and debit card and e-payments sectors, announcing the launch of an investigation into the company’s alleged breach of competition laws, with a possible penalty of up to $10.1 million USD.

“There is a lack of competition” said CNDC president Eduardo Greco. “The company’s owners include 14 of the country’s largest banks… with presence throughout every segment of the process, from the issuing, processing and even the installation of card readers and payment interfaces. Out of all purchases, Visa represents 58%, while Prisma’s owners issue 80% of all credit cards in the country” said the official. Argentina has 42 million bank cards in circulation, with over half being credit cards with some of the highest commission rates in the region.

Argentina’s senate has approved the initiative, pushed by Argentina’s Confederation for Medium Businesses (CAME) and the Argentine Chamber of Commerce (CAC), to reduce by half the current credit card commission rates, as well as eliminating debit card commissions and reducing the delay between purchases and remuneration for businesses to a maximum of three days. The initiative’s objective is to “make small and medium-sized businesses competitive in the face of financial sector abuse”, as described by CAME’s president, Osvaldo Cornide.

Full Content: La Voz de Galicia

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