Visa Europe has pledged to significantly cut its interbank fees for cross-border credit card payments and reform its rules following an anti-trust investigation by the European Commission.
Under the proposals, Visa will slash its fees by up to 60% to 0.3% of the value of cross-border transactions.
The move follows proceedings initiated by the EC in July 2012. Commission vice president Joaquin Almunia welcomed the concessions by Visa, saying the proposals will be put to a market test before being made legally binding.
Says Almunia: "Given the importance of card payments for European consumers and businesses across the Single Market, putting an end to restrictions of competition in inter-bank arrangements is a key priority for the Commission. The decision by Visa is a major step forward in that direction."
Visa says it will also reform its rules so that banks will be able to apply a reduced cross-border inter-bank fee when they compete for clients in other member states.
Visa's acquiescence on the issue is the culmination of a five-year investigation by the European Commission into bank card fees, following the opening of proceedings in March 2008. Visa Europe initially offered commitments to cap its debit card MIFs at 0.20% in December 2010, but resisted the imposition of caps on credit cards.
The Commission has recently opened new proceedings against MasterCard to investigate inter-regional inter-bank fees and cross-border acquiring.