# Should Visa and Mastercard be broken up for being a duo-monopoly? **URL:** \ **Category:** Great Debates\ **Created:** [March 21, 2022, 8:28pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446 "2022-03-21T20:28:41Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Bonum\_Legatum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bonum_legatum/32/6183_2.png) [@Bonum\_Legatum](https://boards.straightdope.com/u/Bonum_Legatum)\ **Post date:** [March 21, 2022, 8:28pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/1 "2022-03-21T20:28:41Z")
Forgive my boundless ignorance on this subject, but it seems like there are only two real choices nowadays for bank-issued credit/debit cards - a card with the Visa or Mastercard logo. Have these companies reached the point where they should be broken up to encourage competition - like “baby bells”? ---
**Author:** ![Kent\_Clark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kent_clark/32/105_2.png) [@Kent\_Clark](https://boards.straightdope.com/u/Kent_Clark)\ **Post date:** [March 21, 2022, 8:52pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/2 "2022-03-21T20:52:50Z")
There are also Discover and American Express, to name a couple. If MC/Visa took any predatory steps to wipe them out, such as telling merchants who accepted the small ones couldn’t accept the big ones, then the government would step in. ---
**Author:** ![ekedolphin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ekedolphin/32/10003_2.png) [@ekedolphin](https://boards.straightdope.com/u/ekedolphin)\ **Post date:** [March 21, 2022, 8:59pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/3 "2022-03-21T20:59:58Z")
Government regulatory action _has_ occurred against Mastercard and Visa for anti-trust violations, as seen here: > **[Mastercard](https://en.wikipedia.org/wiki/Mastercard#Antitrust_issues_in_the_United_States)** > > Pages for logged out editors learn more > > > > Mastercard Inc. (Stylized as MasterCard from 1979-2016, mastercard from 2016-2019) is the second-largest payment-processing corporation worldwide. It offers a range of financial services. Its headquarters are in Purchase, New York. Throughout the world, its principal business is to process payments between the banks of merchants and the card-issuing banks or credit unions of the purchasers who use the Mastercard-brand debit, credit and prepaid ... ---
**Author:** ![DPRK](https://avatars.discourse-cdn.com/v4/letter/d/4491bb/32.png) [@DPRK](https://boards.straightdope.com/u/DPRK)\ **Post date:** [March 22, 2022, 1:34am UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/4 "2022-03-22T01:34:29Z")
Companies like UnionPay are _globally_ bigger. Have Mastercard and Visa been illegally keeping them from expanding into new markets? ---
**Author:** ![LivingGhost371](https://avatars.discourse-cdn.com/v4/letter/l/b9e5f3/32.png) [@LivingGhost371](https://boards.straightdope.com/u/LivingGhost371)\ **Post date:** [March 22, 2022, 4:33pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/5 "2022-03-22T16:33:40Z")
I don’t want to have to carry around four or five credit cards to have one that will work everywhere I shop. ---
**Author:** ![Joey\_P](https://avatars.discourse-cdn.com/v4/letter/j/919ad9/32.png) [@Joey\_P](https://boards.straightdope.com/u/Joey_P)\ **Post date:** [March 22, 2022, 5:09pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/6 "2022-03-22T17:09:42Z")
> [@ekedolphin](#): > > Government regulatory action _has_ occurred against Mastercard and Visa for anti-trust violations, as seen here: I regularly get small refunds via my merchant account for this kind of stuff. It mentions a large settlement back in 2003, that’s probably when I got a $3000ish settlement check. I’m on a class action suit right now for [something or another involving Visa/MC antitrust](https://www.paymentcardsettlement.com/en). Honestly, I don’t usually even read them all that closely. The chance of me/my business ever directly suing MC or Visa (and especially about this exact thing) are about as close to zero as they can get, so if all I have to do is not opt-out, I’ll just sit back and wait for them to mail me a check. It’s always fun when it shows up and I still don’t know if it’s going to be $1.00 or $1000. ---
**Author:** ![kenobi\_65](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kenobi_65/32/13178_2.png) [@kenobi\_65](https://boards.straightdope.com/u/kenobi_65)\ **Post date:** [March 22, 2022, 5:17pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/7 "2022-03-22T17:17:39Z")
> [@Kent\_Clark](#): > > There are also Discover and American Express, to name a couple. This NerdWallet article from last year indicates that both AmEx and Discover have been working to increase their acceptance rate in the U.S., and both cards are now said to be accepted at 99% of U.S. retailers that accept credit cards. Outside the U.S., it can be a different story, however, and depending on the country (and the retailer), Visa and Mastercard likely still have an edge. > **[Who Has the Acceptance Edge: American Express or Discover? - NerdWallet](https://www.nerdwallet.com/article/credit-cards/discover-american-express-acceptance)** > > Discover and American Express are both widely accepted in the U.S., though AmEx has a slight lead. But you'll still want a backup when traveling abroad. ---
**Author:** ![kenobi\_65](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kenobi_65/32/13178_2.png) [@kenobi\_65](https://boards.straightdope.com/u/kenobi_65)\ **Post date:** [March 22, 2022, 5:27pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/8 "2022-03-22T17:27:27Z")
> [@DPRK](#): > > Companies like UnionPay are _globally_ bigger. Indeed; the three major non-US players are UnionPay (China), RuPay (India), and JCB (Japan). I’m not sure what acceptance level they have in the U.S., though this article indicates that JCB cards are accepted in the Discover network. I’m also not sure if U.S. residents can get them – the same article says that JCB stopped its U.S. operations in 2018. > **[What Is a JCB Credit Card?](https://wallethub.com/answers/cc/what-is-jcb-credit-card-2140668892/)** ---
**Author:** ![Bonum\_Legatum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bonum_legatum/32/6183_2.png) [@Bonum\_Legatum](https://boards.straightdope.com/u/Bonum_Legatum)\ **Post date:** [March 24, 2022, 6:18pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/9 "2022-03-24T18:18:16Z")
Thank you for all of the replies. It seems odd that, at least in the United States, the government would have established control of the monetary system through the Federal Banking system - but then let a large and growing number of financial transactions be handled by private entities. ---
**Author:** ![Telemark](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/telemark/32/372_2.png) [@Telemark](https://boards.straightdope.com/u/Telemark)\ **Post date:** [March 24, 2022, 6:53pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/10 "2022-03-24T18:53:51Z")
> [@Bonum\_Legatum](#): > > but then let a large and growing number of financial transactions be handled by private entities. Why would the US government be in charge of handling/resolving commercial transactions? ---
**Author:** ![Beelzebubbly](https://avatars.discourse-cdn.com/v4/letter/b/b9bd4f/32.png) [@Beelzebubbly](https://boards.straightdope.com/u/Beelzebubbly)\ **Post date:** [March 25, 2022, 11:27pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/11 "2022-03-25T23:27:32Z")
Damn right. We have far too many megacorps, and we really do need to take a legal sledgehammer to 'em. Just my one fiftieth of a dollar. ---
**Author:** ![suranyi](https://avatars.discourse-cdn.com/v4/letter/s/e36b37/32.png) [@suranyi](https://boards.straightdope.com/u/suranyi)\ **Post date:** [March 26, 2022, 4:08am UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/12 "2022-03-26T04:08:05Z")
I was surprised to see that a local diner, not part of a chain, accepts UnionPay. ---
**Author:** ![wolfpup](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wolfpup/32/10618_2.png) [@wolfpup](https://boards.straightdope.com/u/wolfpup)\ **Post date:** [March 26, 2022, 5:18am UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/13 "2022-03-26T05:18:43Z")
> [@Bonum\_Legatum](#): > > It seems odd that, at least in the United States, the government would have established control of the monetary system through the Federal Banking system - but then let a large and growing number of financial transactions be handled by private entities. Strangely enough, the Federal Reserve Banks are actually private entities, too. They’re a bit unusual as the degree of federal government control and oversight gives them some of the characteristics of a government agency, but they are indeed a special kind of regulated private entity. Regarding Visa and Mastercard, as pointed out there are options like American Express and Discover, but more importantly, neither of those first two are actually card issuers. They are, essentially, operators of payment networks. So although they are large corporations that are certainly capable of monopolistic behaviour within their business domains, they do not and cannot control things like credit card approvals, credit limits, interest rates, card types and benefits, or other terms and conditions. Those are all controlled by the issuing banks. The banks pay Visa or Mastercard for blocks of CC numbers and for the right to issue cards branded with their logo and use their payment network, but otherwise the banks all run their own credit card businesses on their own terms. This limits the monopolistic shenanigans of the payment operators, at least as far as the end-user is concerned. That said, the whole credit card business is a highly profitable cash grab for the banks and the network operators. ---
**Author:** ![Bonum\_Legatum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bonum_legatum/32/6183_2.png) [@Bonum\_Legatum](https://boards.straightdope.com/u/Bonum_Legatum)\ **Post date:** [March 26, 2022, 1:41pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/14 "2022-03-26T13:41:55Z")
Thank to all the respondents, and especially to you wolfpup. ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [March 26, 2022, 2:00pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/15 "2022-03-26T14:00:36Z")
We’re talking about a market that has a natural, network-based barrier to entry. There’s no incentive for a merchant to accept a card that nobody uses, and no incentive for a consumer to get a card that no merchant accepts. Even without nefarious action by any particular company, that often tends to lead to monopolies. And yet, we have two different major companies, and two more companies that are smaller but are still completely viable, and niche incursions by yet other companies. That sounds, to me, like an incredibly vibrant and robust market, given the circumstances. It might be that that’s the case because of effective government anti-trust action. But if so, it’s been very subtle and light-handed. They haven’t needed to do anything so extreme as forcibly breaking up a large company. ---
**Author:** ![Joey\_P](https://avatars.discourse-cdn.com/v4/letter/j/919ad9/32.png) [@Joey\_P](https://boards.straightdope.com/u/Joey_P)\ **Post date:** [March 26, 2022, 2:00pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/16 "2022-03-26T14:00:39Z")
> [@kenobi\_65](#): > > Indeed; the three major non-US players are UnionPay (China), RuPay (India), and JCB (Japan). I’m not sure what acceptance level they have in the U.S., though this article indicates that JCB cards are accepted in the Discover network. I’m also not sure if U.S. residents can get them – the same article says that JCB stopped its U.S. operations in 2018. My older credit card terminals used to list JCB and Diner’s Club in the list of cards we accept. I’m sure if you swiped one it would work, but I’ve never seen either of them. Now, we never would have intentionally requested to be able to take either of them, so they’re probably just part of something else. You mentioned JCB is accepted as part of Discover and it looks like Diner’s Club is as well. ---
**Author:** ![k9bfriender](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/k9bfriender/32/3283_2.png) [@k9bfriender](https://boards.straightdope.com/u/k9bfriender)\ **Post date:** [March 26, 2022, 2:04pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/17 "2022-03-26T14:04:50Z")
> [@wolfpup](#): > > Regarding Visa and Mastercard, as pointed out there are options like American Express and Discover, but more importantly, neither of those first two are actually card issuers. They are, essentially, operators of payment networks. I’ll also point out that they are also not the actually merchant service provider, either. I don’t have an account with Visa and Mastercard and Amex and Discover, I have one with a separate merchant service provider, and there’s competition in that market, given how many calls I get to try to get me to switch to their services. Now, the payment networks _do_ set their transaction fees, but there is still competition and room for negotiation there as well, it’s just being done at the merchant service provider level, rather than the individual business. ---
**Author:** ![TheCuse](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/thecuse/32/2854_2.png) [@TheCuse](https://boards.straightdope.com/u/TheCuse)\ **Post date:** [March 26, 2022, 2:10pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/18 "2022-03-26T14:10:59Z")
I remember when in the USAF and stationed at Woomera, South Australia. When going to the local towns for the weekend you had to be sure to have the right credit card. One town (Port Pirie only took Mastercard, while Port Augusta only took Visa. Learned this the hard way as I was going to Port Pirie and blew a tire. Only had Visa so I had to pay cash for everything. EDIT: This was back in the mid-80s ---
**Author:** ![k9bfriender](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/k9bfriender/32/3283_2.png) [@k9bfriender](https://boards.straightdope.com/u/k9bfriender)\ **Post date:** [March 26, 2022, 2:11pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/19 "2022-03-26T14:11:43Z")
> [@Chronos](#): > > There’s no incentive for a merchant to accept a card that nobody uses, and no incentive for a consumer to get a card that no merchant accepts. There’s a bit, in that many individual stores do offer their own credit cards, in fact, that’s how the whole idea of credit cards started in the first place. The _big_ players started out as essentially just consolidating and working with different stores so that consumers only had one card and one bill, but could shop at multiple stores with that card. Gift cards are a form that smaller businesses can use as well. It’s just like a prepaid debit card, with much lower fees involved to the merchant. There’s no technical reason that you couldn’t use them to extend credit to clients, so long as you trust them and can eat the costs for those who default on them. Nice thing about taking a Visa charge is that even if the client never pays their Visa bill and declares bankruptcy, _I_ still get paid. The competition really comes down to how many cards you are willing to stuff into your wallet. With smart phones being used for payment now, that may make it easier to carry a multitude of payment options, but still only have one thing to carry around, and online billpay makes paying multiple vendors easier or even automatic. ---
**Author:** ![Joey\_P](https://avatars.discourse-cdn.com/v4/letter/j/919ad9/32.png) [@Joey\_P](https://boards.straightdope.com/u/Joey_P)\ **Post date:** [March 26, 2022, 2:28pm UTC](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446/20 "2022-03-26T14:28:57Z")
> [@k9bfriender](#): > > how many calls I get to try to get me to switch to their services. And those people are the absolute worst. I refuse to talk to credit card processors that make cold calls. Even worse are the ones that randomly show up and if you show even the smallest bit of interest, will start asking to see your last X months worth of statements. Rant: When I do want/need to change, I do my best to get numbers out of them before they look at my statements, otherwise they’ll act like god’s gift to merchants by saving you $50/mo…a savings of which will disappear at the first rate hike. For the amount of work required to switch processors, I usually tell them they have to be saving me something closer to $500-$1000/mo before I’ll even put any real thought into switching. And I always find their ‘taken aback’ reaction amusing after they were so proud of being able to save me ‘almost a thousand dollars a year’. And some of the really incessant people, those salespeople that will randomly call from a company I didn’t reach out to and I’ve never heard of, that will call over and over until I finally make an appointment. I found that telling them they only time they can meet me is when I get to work at 3am (no ones here at 3am) OR I’ll tell them they have to meet me at my office, not the store, and give them some BS address 20 miles away. And before anyone says anything, 99% of the time I hang up on them as soon as I know that it’s a cold call from a processor. I only do this when I’ve asked them over and over to stop calling. For some of these companies, making an appointment seems to get me off their call list, even if the appointment will never happen. I really hate dealing with these people. [Next page](https://boards.straightdope.com/t/should-visa-and-mastercard-be-broken-up-for-being-a-duo-monopoly/961446.md?page=2)