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The U.S. Department of Justice wants more information from Visa Inc. on its U.S. debit practices, a continuation of an investigation originally started in 2021.
Visa disclosed the request in a Jan. 27 U.S. Securities and Exchange Commission filing and said the Justice Department’s Antitrust Division made the request on Jan. 4. Specifically, Justice is looking for “additional documents and information focusing on U.S. debit and competition with other payment methods and networks,” the Visa filing stated. The card network is cooperating with the investigation. The Justice Department opened its investigation in March 2021. Visa said that inquiry was about a potential violation of Section 1 or 2 of the Sherman Act. Section 1 is generally about restraint of trade and Section 2 about monopolization.
Both Visa and Mastercard Inc. have faced scrutiny over their debit practices, though often to different degrees. The Federal Trade Commission leveled a preliminary consent order against Mastercard to correct what the agency saw as roadblocks the card company had erected against routing online debit transactions to competing networks. Visa was not part of that order.
In this latest instance, the investigation of Visa could center on debit-routing practices, long a contentious issue for merchants. In 2021, the Justice Department said it supported a proposed Federal Reserve Board rule to reinforce merchants’ choice of networks for e-commerce transactions made with debit cards. For Visa, at least, that rule, which goes into effect July 1, is projected to have a minimal impact, Vasant Prabhu, Visa chief financial officer, said in October during an earnings call.
Around the same time, Mastercard reiterated its plans to compete in debit. “We will continue to compete [for debit volume] with all the assets we have. We will have the technology to win debit in the United States,” Mastercard chief executive Michael Miebach said in October during that company’s quarterly earnings call.
