How Would the Credit Card Competition Act Impact Visa and Mastercard?
Credit card companies have come under increasing scrutiny from the federal government, and Congress recently proposed a bill to increase competition in credit card processing networks. The goal is to lower transaction fees, saving merchants and consumers money.
The move would be particularly meaningful for Visa (NYSE: V) and Mastercard (NYSE: MA), the world's two largest credit card processors. Here's what's in the bill and what it might mean for their bottom lines.
According to research from Ascent, credit card processing fees for merchants range from 1.15% plus $0.05 to 3.15% plus $0.10 in interchange fees, plus another 0.14% to 0.17% in assessment fees. These are fees paid to the card's issuing bank, the card's payment network, and the payment processor.
Source Fool.com
