Other Winners and Losers?
Some of the parties who are watching the VISA v. Wal-Mart case most closely include executives from Memphis, Tennessee-based Concord EFS and the Denver, Colorado-based First Data Corporation. If regulators sign off on their merger, the joint Concord/First Data firm will control 75% of a debit transaction market that, thanks to the VISA/Wal-Mart suit, is poised to grow even larger, industry analysts said. "If it's getting to be all about volume, then the Concord/First Data company may find itself very well placed," remarked one analyst. He pointed out that as the largest national EFT network, the Concord/First Data firm would likely pick up additional transaction volume at a higher interchange rate while the financial institutions took a hit from having to accept lower interchange on debit transactions processed through the card associations. But other analysts countered by pointing out that the new firm's size may hurt the retailers' case and may even bring them into the retailers' sights. Legal experts have pointed out publicly that it will be harder for the retailers to make a case that the card associations are monopolies if, at the same time, the EFT Networks are doing well and consolidating. Also, as Stan Paur, CEO of the Houston-based PULSE EFT Association has pointedly asked, how many retailers will relish having only one channel for processing their payment transactions? -