The Retail Industry Leaders Association has come out against the agreement which has been proposed to settle retailer complaints about the way credit card interchange has been calculated and paid.
RILA's members include such diverse firms as Walmart, Abercrombie & Fitch, Apple and Pep Boys. Walmart has already, independently, come out against the agreement.
“While Visa and MasterCard’s decision to pursue a settlement affirms the legitimacy of retailers’ claims, the flawed proposal upholds the networks’ anticompetitive practices and fails to provide retailers and their consumers with meaningful relief from tens of billions of dollars in hidden fees,” said RILA President Sandy Kennedy.
“We urge class plaintiffs to reject the proposal and send a clear message that a settlement that fails to engender competition and fix the broken electronic payments market is unacceptable,” Kennedy said.
If the proposed settlement is ultimately approved, all retailers will be bound by its terms. Among the many proposed terms that concern retailers is the release of Visa and MasterCard from any future legal claims related to their interchange practices and terms that could stifle emerging innovations, such as mobile payments, RILA complained.
“Retailers are concerned that in addition to limiting their future legal options, the proposed settlement preserves the Visa/MasterCard duopoly and constrains emerging innovations that could bring meaningful competition to the marketplace,” added Kennedy.
The National Association of Convenience Stores, the National Grocers Association, the National Cooperative Grocers Association, and the National Community Pharmacists Association have also come out against the proposed settlement.
Industry analysts have expressed confidence that retailers, in the end, will still approve the proposed agreement.