Credit Card Ethics

On October 7, 1998 the Department of legal expert announced its intent to work Visa and MasterCard on antitrust grounds. U.S. Attorney General Janet Reno said, The Justice Departments antitrust division found persuasive and magisterial evidence of the harm done to competition in the assurance card market. Competitive initiatives that could benefit consumers have been abandoned, delayed or suppressed. Consumer choice has been reduced, and competition among card ne 2rks has been substantially restrained(American stub out Company, 2000, 1). The suit is universe issued by the DOJ, but clearly being driven by American Express and Discover respectively. These companies, the two re maining credit card brands that make up the main players in the industry, have much to gain in a judgement against Visa and MasterCard. To understand the issues, and stakes a rudimentary understanding of the current industry structure is necessary. Visa and MasterCard argon non-stock, not for profit membership corporations owned by thousands of different financial initiations (i.e.- banks, credit unions etc.). The Visa connector was formed by a group of American banks in the late 1960s to facilitate its members in issuing general-purpose payment cards and theatre language merchants to accept those cards (Allen, 2000, 2).

Visa and MasterCard are considered to be an readable or joint venture relationship with each some other and their association members. In essence, this means any financial institution may join the Visa and MasterCard associations assuming they can match certain capital adequacy requirements, and comply with certain association rules. In return, Visa and MasterCard provide essential functions to the member banks. They indorse their members to issue Visa and MasterCard branded credit and debit cards, sign members to accept those cards, market the cards to ensure brand recognition, arise new card products and services, and provide an infrastructure of communications, processing, authorization, and... If you want to give a full essay, order it on our website: Orderessay

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