(Washington, DC)-- Interim Attorney General Peter J. Nickles announced today that Visa USA Inc. ("Visa") has revised its rules for payment cards branded both as Visa cards and non-Visa ATM debit cards, and clarified application of existing Visa rules. Visa’s action follows a District of Columbia-led investigation coordinated with the States of New York and Ohio, and a parallel investigation by the United States Department of Justice. The Attorney General explained that “Under Visa’s revised rules many merchants will have a new freedom to accept ATM debit payments through Visa's PIN-debit network competitors, including such ATM debit card competitors as Star, MAC, NYCE, and others, without requiring customers to provide PINs. Customers will have more payment options.” He added, “We hope that Visa’s revised practices will bring the benefits of enhanced competition to debit card transactions, including enhanced competition in the pricing of electronic payment processing fees.”
The Visa rule revisions are described in a public letter issued by Visa earlier today. The letter also clarifies how certain unchanged Visa rules, applicable to Visa-member banks, will continue to govern merchants' acceptance of Visa cards. The Visa letter explains, among other things, how under Visa's existing rules, a merchant offering any combination of Visa credit or debit payment options is permitted to steer customers to non-Visa payment options. The merchant may present the cardholder with a non-Visa payment choice as the default, so long as the cardholder is free to override that choice and pay through Visa. The merchant must clearly disclose both the default choice and the process for overriding that choice.
An illustrative application of the revised Visa rules is a customer with a card branded both as a Visa card and a Star ATM debit card who in the future may more easily buy a book offered on an internet web-site and pay for it through the Star ATM debit system. First, under existing rules the internet merchant may make Star the default debit payment option. Second, Visa no longer prohibits the merchant from processing the customer's debit payment through Star when the merchant has not obtained the customer's PIN.
Attorney General Nickles added: "We in the District of Columbia appreciate the collaborative work of attorneys in the offices of the Ohio and New York Attorneys General, and at the United States Department of Justice, as well as the cooperation of counsel for Visa USA."
Following the issuance of Visa's letter, the District remains free to bring whatever action or proceeding it subsequently concludes is required by the public interest if Visa's future practices prove to be anticompetitive.
Select the link below to view a copy of Visa’s public letter.