In a move likely to fuel retailers’ hostilities toward Visa U.S.A., the association is planning to raise the fees merchants pay to accept certain Visa debit card transactions at the point of sale — fees that the issuing banks reap as revenue — American Banker has learned.

Visa U.S.A. confirmed in a statement that it plans in October to raise merchant fees for its Interlink network, but would not say by how much. According to one industry source, Interlink now charges up to 20 cents per transaction, and the new rate will be up to 45 cents.

Merchants’ anger over the associations’ debit card acceptance rules have already led to an antitrust class action, now pending in federal court in New York. But that did not stop Visa’s board of directors from voting in June to raise interchange fees for Interlink, the national electronic funds transfer network that processes PIN-based debit card transactions.

Any rate hike would accentuate the difference between what merchants pay to accept Visa debit transactions and what they pay to accept debit transactions that are routed through the regional electronic funds transfer networks, most of which charge between 10 and 17 cents per transaction.

Industry observers and executives at the regional networks say they suspect Visa is trying to induce the regional networks to raise their prices as well, since a closer alignment of association and non-association interchange rates could undercut some of the merchants arguments in the antitrust suit, nicknamed the Wal-Mart case after the original lead plaintiff.

Visa would not discuss the implications of the fee hike for the Wal-Mart case or for the other networks. A Visa spokesman, Kelly Presta, said it was the first price change for Interlink in more than two years.

Mr. Presta said in a prepared statement: “Over the long term, these interchange modifications will increase the number of Interlink Visa cardholders, usage by consumers, and the level of merchant acceptance.”

Lloyd Constantine, the attorney for the merchants in the class action, said that what Visa is doing “will simply dig their hole in the litigation that much deeper.”

“While we certainly don’t welcome what they’re doing, because it’s highly anticompetitive, highly injurious to our clients in the Wal-Mart case, it simply creates more evidence on an already amazingly large pile of evidence that Visa and MasterCard are trying to destroy the regional network competitors and trying to exert their extraordinary market power over merchants,” Mr. Constantine said.

It is no secret that Visa is trying to encourage consumers to rely on signature-based debit transactions, which are more expensive for merchants but generate more revenue for bank card issuers. For signature-based debit, Visa charges 1.25 times the transaction amount plus 10 cents, or a flat transaction fee of 40 cents for supermarkets.

To counter the pressure from the associations toward signature-based debit, some merchants — including Wal-Mart — have begun encouraging consumers to use PIN-based debit, by asking at the point of sale for the consumer to type in a personal identification number. This process, known as “steering,” is legal under the associations’ rules.

But the associations and some of their members are apparently taking extra steps to combat steering and promote signature debit. Last week, Commerce Bancshares Inc. of Kansas City, Mo., announced a sweepstakes for customers who choose to complete their debit card transactions by signature rather than by PIN.

In the contest, called “Skip the PIN — and Win,” each time a Commerce Bank customer uses a Commerce Visa check card to complete a signature-based transaction, the customer’s name is automatically entered in a drawing for a $1,000 weekly prize and a $25,000 grand prize.

Commerce Bank held the contest last November and December and said it awarded $86,000 to more than 60 winners. This year’s contest began May 1 and will run through yearend. During the holiday season Commerce will sweeten the contest, awarding $1,000 a day.

“It’s not so much that we’re opposed to PIN-based transactions,” said Carl Bradbury, Commerce Bank’s prefunded products manager. “We like all transactions. We’re stressing to those customers the benefits of using the card and processing that transaction through Visa.”

Those benefits include Visa’s zero-liability policy, which states that if a card is used without the customer’s authorization, the cardholder is not liable to pay for any of the transaction. Additionally, Visa has a dispute-rights policy that addresses concerns if customers feel they did not get the type of service they expected.

“These are the things that we’re reminding customers are available through this product,” Mr. Bradbury said. The interchange fees collected by the bank from those signature-based transactions will help fund the sweepstakes, he said.

With so many of the regional networks in flux, Visa’s move may well prompt some reconsideration of interchange rates by other companies. The largest network, Star Systems, is now owned by a public company, Concord EFS of Memphis, which is busy phasing out the name of a previous network it bought, MAC, in favor of the Star name. NYCE Corp. of Woodcliff Lake, N.J., is being acquired by First Data Corp., another large public company.

Stan Paur, the president and chief executive officer of Pulse EFT Association, the last major independent electronic funds transfer network, said Visa’s changes to Interlink will translate into higher revenues for card issuers and cost merchants more money.

“We’re carefully monitoring these fees and, like any organization, we’ll have to remain competitive,” Mr. Paur said. “The trick is to find the balance that appeals to both the issuers and the merchants.”

Jim Judd, senior vice president at NYCE, said, “Whenever there are marketplace changes you have to look out there and make sure that your products from all dimensions are competitive.”

This is not the first time Visa has appeared to goad the regional EFT networks to raise interchange. In 1998, when it launched its Check Card II product, which bore higher interchange than some other debit cards, “it did get several regionals to increase their interchange” because of the threat of losing banks to Visa, said Peter Davidson, the president of Speer & Associates, the Atlanta-based consulting firm.

“While these regional networks were owned by the banks, Visa wasn’t making any headway,” he said. “Now with the regional networks no longer owned by the banks, the banks have no reason to try to maintain them.”

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