Credit card giant ‘Visa’ has been sued by Australia's competition watchdog for misusing market power to boost profits. It allegedly barred customers and retailers from using currency conversion systems of their choice when doing business.
Visa started implementing their own currency conversion system at all automatic tellers in 2007. Since 2010, Australian shops could only use Visa’s payment system and accept their cards if they complied with the company's standards. The chair of the Australian Competition and Consumer Commission (ACCC) detailed the implications of such practices: Visitors to Australia are bound by Visa’s own currency conversion system when using cash machines; they also have no way of immediately knowing the cost of a transaction in their own currency.The ACCC hopes to prove that the practices were aimed at boosting Visa’s revenues in Australia by denying customers and businesses the ability to share in conversion profits, and that they infringed on the country’s Dynamic Currency Conversion laws.If the ACCC is successful in its case against Visa, the company could be fined up to $20 million or lose a substantial percentage of its revenues in Australia.Visa has strongly denied the allegations that its practices either violate the law or are targeted at boosting its revenues.