Interchange Rates To Drop Within Three Years

Global interchange rates could fall by 15% within the next three years, says Rob Walker, an analyst at London-based RBR Research Ltd. "I can foresee a situation where the rates on MasterCard and Visa [transactions] in the United States will, within the next two to three years, decrease because of all sorts of pressure," Walker tells CardLine sister publication ISO&Agent Weekly. "It's a reasonable expectation that within the next three years they might go down by 15%." Factors include not only legislators inquiring about how rates are set (CardLine, 5/29), but also actions by regulators in other countries and merchant pressure, Walker says. Interchange is regulated in Australia, and the European Commission has fought MasterCard Europe on its cross-border interchange rates. In Europe, Walker estimates that the average interchange rate will decrease by 10% from today's average in the next two to three years. "That trend will increase and accelerate," he adds