Visa Unconcerned about Debit Card Fees

by Mercator Advisory Group 0

Visa’s CEO appeared unconcerned that more issuers are establishing fees for debit card use, acknowledging that consumers may indeed switch issuers. Being in a lead position within the market does offer a cushion to the organization, and it would be difficult to argue the point that consumers have self-selected debit as a preferred payment method.

Whether they receive their debit card from one issuer or another won’t impact the network unless it results in a brand change is one position, but more expensive small ticket transactions and consumers’ bank-directed anger could also results in an increase in cash payments. Next quarter’s figures should be more illustrative of the impact of these changes on the market.

The majority of debit cards in the U.S. bear the Visa logo, so any drop in debit card use could hurt the San Francisco payments processor. In its fiscal fourth-quarter financial report Wednesday, Visa said U.S. debit card use rose 8 percent, with purchases reaching $288 billion.

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