House Judiciary Committee Interchange Hearing Testimony
The testimony of several of the witnesses at today's heading on interchange fees by the US House Judiciary Committee is now available online in PDF format. Included is testimony from: Thomas L. Robinson (Vice President of Regulations, National Association of Convenience Stores), Joshua R. Floum (General Counsel and Corporate Sec., Visa Inc.), Steve Cannon (Chairman, Constantine Cannon, LLP), Joshua Peirez (Chief Payment System Integrity Officer, MasterCard Worldwide), John Blum (Vice President of Operations, Chartway FCU), and Edward Mierzwinski (Consumer Program Director U.S. PIRG).
Stumble It!
Today I sat down and read through all of the testimony and must admit understanding the concepts of interchange am troubled by the testimony provided by both Visa and MasterCard. Neither provided sound enough arguments to justify interchange whereas those opposed clearly demonstrated that Interchange clearly benefitted the issuing banks at the expense of the merchant and consumer. The only testimony that offered any sound support for interchange was that offered by John Blum. Yet his arguments simply argued that without a fixed interchange structure smaller players would not be able to play which does suggest that the interchange mechanism as a competitive process is flawed.
Interchange, as we know it, is under a microscope and the issuing institutions are well advised to prepare themselves for the inevitable.
Posted by: Philip Andreae | May 16, 2008 at 04:00 PM