U.S. sues Visa for monopolizing market (youtube.com)
Debit transactions, preferred usually by low net worth clients.
DoJ alleges Visa does a web of unlawful anti-competitive agreements to penalize merchants and banks for using competing payment networks (especially tech companies like Square), and coerces would-be market entrants into unlawful agreements not to compete, threatening high fees if they don't cooperate, and promising big payoffs if they do. The result is Visa can charge fees much higher than they could in a competitive market. Visa has basically eliminated the choice to use other options, not by offering the most competitive rates or the most innovative product, but by unlawfully structuring its contracts to disincentivize competitors. It is a ‘must carry’ network, because certain purhcases can ONLY be completed using the Visa network. ... Volume requirements or face higher fees. The banks then can't chose the offering with the lowest price but fear losing the economy of scale savings.
This increases the price of nearly everything.
The Sherman Anti-Trust prohibits entering into contracts with would-be competitors to prevent them from becoming actual competitors. Leveraging monopoly power to limit competitors ability is also.
This harms Americans, DoJ says, because it distorts the market, raising prices and limiting variety.
Most people think about Visa as credit cards (they have 1.3b ccs), but they have 3.2b debit cards. So it's ‘more’ of a debit card business than a cc business. (Mastercard has 3b cards total counting both types.)
Why isn't Mastercard being sued? It's a little bit growing faster than Visa. Because Visa ‘punishes’ merchants who don't do ‘exclusivity agreements' with them.
Joseph Carlson has argued that even if Visa didn't charge merchants these fees, the merchants would just keep that themselves and the consumer wouldn't be any better off. 'It would go to Walmart's bottom line.'
Cheaper options might not be as trustworthy anyway, and might not have as strong of protections for the card user.
Amazon, Google, Meta, Apple, etc, being dominant companies, as long as they are dominant, will always be targetted as a monopoly, but they usually win these cases.