Preserving interchange: from explicit to implicit MIF

Type: Methodology
Author: Malte Krueger, Christoph Strauch
Year of Publishing: 2008
Keywords: English

The collective setting of interchange fees is interpreted by many competition authorities as collective price fixing. It is argued that the collectively set interchange fee is used to set a minimum price on the acquiring side of the market. So far, these concerns led to the introduction of regulatory regimes which basically meant that a kind of cost-based interchange was introduced. [...] The recent MasterCard decision of the EU Commission, however, seems to be more serious threat against interchange in general.