Credit card providers could be on track to receive fines from the European Union (EU) under new proposals in a draft report due to be delivered this week.
Fines could be levelled at providers for blocking competition in the credit card market, including those which offer the best rate, which is ultimately of detriment to the consumer, reports Bloomberg.
Under new EU proposals those providers found to be blocking healthy competition would face fines of up to ten per cent of total worldwide sales. The European Commission has stated that it “will not hesitate to exercise its powers of enforcement” in this regard.
In the long run it is hoped that new regulatory measures will make it easier for consumers to compare credit cards and find the best rates while being protected from the effects of monopolisation.
The draft report highlights transaction fee practices run by Visa International and Mastercard, the two largest credit card providers in the world.
Interchange fees paid between the two providers have been focused upon as a key area of concern.
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