MasterCard in Hot Water

The Office of Fair Trading (OFT) is on the hunt for the international credit card association MasterCard for its policy of charging an interchange fee on consumer transactions. The claim by the OFT is that this policy creates an unfair tax on consumers, in violation of British and European competition laws.

If MasterCard is found guilty of this action then guess who will be next up in the chamber, that’s right, Visa. This is a big deal with a lot of money at risk. Don’t expect this to be resolved quickly.

It is estimated that the cost of this interchange tax passed onto consumers adds £500 million to the cost of goods sold.