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NGA calls on Visa to quickly remove any operating rule that violates federal law

Arlington, VA, 2016-Nov-21 — /EPR Retail News/ — The National Grocers Association (NGA) applauded the Federal Reserve for taking steps to protect competition in the debit card marketplace and called on Visa to quickly remove any operating rule that violates federal law.

Earlier this month, the Federal Reserve Board of Governors clarified that no payment card network can directly or indirectly force retailers to deploy a technology or enforce a rule that inhibits merchant routing choice, and that any technical specifications, that inhibits merchant routing choice is out of compliance with federal law.  The Federal Reserve’s action comes after merchant organizations, including NGA, and other parities raised concerns over Visa’s actions that were deployed as part of EMV migration upgrades.

In 2010, debit reform legislation was passed that increased competition in the debit routing market by requiring that at least two unaffiliated debit routing network be available to merchants for all purchases made using debit.  These reforms interjected competition back into a marketplace that was quickly becoming devoid of competition and debit routing choice.

In a letter sent yesterday to Visa, signed by leading merchant trade association CEOs, merchants called on Visa to detail their plans to comply with federal law and ensure that those merchants who have already migrated to EMV will not require re-certification nor any liability shift should they have to re-certify.  The letter also called on Visa to suspend its liability shift, which has placed an undue burden onto independent supermarket operators.

“On behalf of America’s independent supermarket operators, NGA appreciates the Federal Reserve’s action clarifying that federal law prohibits Visa and other card networks from impeding a merchant’s choice when it comes to which network to use when routing debit transactions,” said Peter J. Larkin, NGA president and CEO.  “NGA is committed to continuing our efforts to bring about true reform of the anti-competitive market that currently exists between Visa, MasterCard and their issuing banks.”


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Source: NGA

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