WASHINGTON - (07/20/06) Visa USA and MasterCardWorldwide and the nations merchants brought their anti-trustbattle to Capitol Hill, with some critics of the two card giantswondering whether it was time to break up the two companies. AWashington lawyer who represented the merchants in their $3 millionanti-trust settlement with Visa and MasterCard told the SenateJudiciary Committee that there are parallels to the twocompanies stranglehold over the electronic transactionsmarket, with that of AT&T, before the court-ordered divestitureof the telephone services giant in 1982. Representatives of themerchants asked the senators to start an anti-trust investigationinto alleged price-fixing for transaction fees by Visa andMasterCard, which control more than 80% of the current $30 billionin interchange fees paid in the U.S. each year. That includes feesmerchants pay to their credit union or bank; the fees credit unionsand banks pay to Visa and MasterCard; and the fees consumers pay touse their credit and debit/ATM cards. Visa and MasterCard, bothcontrolled by the big banks, remained adamant that there is vibrantcompetition in the setting of interchange fee. Joshua Floum,general counsel for Visa, insisted that broad competition from thelikes of American Express, Discover, First Data, Debitman, PayPal,Google, Checkout, and a growing number of entries, prevents the twocard giants from fixing prices. Theres plenty ofchoices, Floum said. The setting of fees is a big issueamong credit unions; in fact, a billion-dollar-a-year issue. Creditunion and bank members of Visa and MasterCard have been slammed thepast three years by both companies to pay growing legal expenses,including the $3 billion settlement with Wal-Mart Stores and themerchants group. That has resulted on lower interchange fees paidto credit unions. More than 40 anti-trust suits still pending makelegal liability an open question.
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Synovus Financial demonstrated at an industry conference how it is using Microsoft's Copilot to help its staff address customers' concerns.
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The U.S. arm of Spanish banking giant Santander has hired Swati Bhatia to oversee retail banking and its digital transformation efforts. Bhatia joins at "an inflection point" for the company, which aims to be "a digital bank with branches," CEO Tim Wennes said.
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Mariya Rosberg is named Americas head of banking and financial services at Marsh McLennan's Oliver Wyman unit; startup ZayZoon raised $15 million in a new funding round; and more in the weekly banking news roundup.
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But the 30-year fixed rate mortgage is still near 7%, and that remains the overhang on the housing market, Freddie Mac said.
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