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FTC Orders Mastercard to Stop ‘Illegal Business Tactics’

The Federal Trade Commission has ordered Mastercard to stop its 'illegal business tactics' in an effort to level the debit card payment field....
FTC Orders Mastercard to Stop ‘Illegal Business Tactics’
Written by Matt Milano
  • The Federal Trade Commission has ordered Mastercard to stop its ‘illegal business tactics’ in an effort to level the debit card payment field.

    Debit cards are increasing in popularity, but Mastercard has unfairly dominated the industry. The 2010 Dodd-Frank Act known includes a provision known as the Durbin Amendment. The Durbin Agreement “required banks to enable at least two unaffiliated networks on every debit card, thereby giving merchants a choice of which network to use for a given debit transaction.”

    According to the FTC, Mastercard flouted “the law by setting policies to block merchants from routing ecommerce transactions using Mastercard-branded debit cards saved in ewallets to alternative payment card networks, including networks that may charge lower fees than Mastercard.”

    As a result, the FTC is ordering Mastercard to provide competing networks with the customer data they need to be able to process debit card payments.

    “This is a victory for consumers and the merchants who rely on debit card payments to operate their businesses,” said Holly Vedova, Director of the FTC’s Bureau of Competition. “Congress directed the FTC to enforce this part of the Dodd-Frank Act and prevent precisely this kind of illegal behavior. We take this responsibility seriously, as demonstrated by our action today.”

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