According to an AP report, Visa has announced it will cut credit card interchange fees or swipe fees for both online and in-store transactions by 10% for small businesses.
Visa cuts credit card fees for small businesses
The lower rates will begin in April, and Visa hopes they will help maintain their status as one of the world’s largest payment companies. While the pandemic has increased Visa’s market share in the digital payments industry as more people shop online and more card-accepting places, more and more technology companies are introducing alternative forms of payment that bypass traditional credit and debit card networks.
Visa criticized for rate hikes
The reduction in credit card exchange fees for small businesses is in response to protests against Visa’s plan to actually increase fees, known as swipe fees. Both Visa and Mastercard had originally planned to raise rates last year but have postponed the move due to the pandemic.
In response to complaints about rate increases as inflation mounts, Visa agreed to lower some small business rates along with travel and daycare companies.
New criticism of the concession has been led by the Merchants Payments Coalition, which believes the swipe fee cuts hit too small an industry and won’t do anything to help the vast majority of retailers cope with the rising tide. inflation.
Visa vague on the definition of small business
Visa itself stated that the swipe fee reduction should affect “90% of businesses,” but did not specify how they define small businesses.
Details remain vague, although the new agency Reuters reported that the rate cut will apply to merchants with $250,000 or less in Visa consumer credit volumes.
Current Visa Swipe Fee Rates
Consumer credit card internet rates are fees that every merchant must pay with every credit and debit card transaction. Visa currently charges 1.5% to 2.4% for all consumer credit card interchange fees.
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