Mastercard has unveiled a credit card that uses fingerprint sensor technology.
The rollout follows two successful trials in South Africa.
MasterCard‘s technology works in the same way as it does with mobile phone payments: users must have their finger over the sensor when making a purchase.
According to security experts, using fingerprints is not foolproof, but it is a “sensible” use of biometric technology.
MasterCard‘s chief of safety and security Ajay Bhalla said that the fingerprint technology would help “to deliver additional convenience and security. It is not something that can be taken or replicated”.
Wal-Mart has sued Visa for $5 billion, alleging that the credit card company worked with large banks to fix the price of transaction fees it charged to the retailer.
The move comes after Wal-Mart opted out of a $5.7 billion settlement with Visa and MasterCard in December.
Wal-Mart and other US retailers, such as Target, objected to the terms of that agreement.
Visa had sued Wal-Mart in June 2013 to prevent the firm from filing a lawsuit.
Wal-Mart has sued Visa for $5 billion, alleging that the credit card company worked with large banks to fix the price of transaction fees it charged to the retailer
Wal-Mart, which is the world’s largest retailer, argues that Visa worked with large banks “to illegally fix the interchange fees and inflate the network fees that Wal-Mart and other merchants pay on Visa charge card transactions”.
Those large fees then caused “enormous damage” between 2004 and 2012, the retailer claims.
Wal-Mart is now suing Visa for damages, which it estimates to be over $5 billion.
Visa declined to comment on the lawsuit, which was filed this week in Fayetteville, Arkansas, near Wal-Mart’s headquarters.
The European Commission is investigating MasterCard over fees charged for card transactions made by people visiting Europe.
The Commission said some of MasterCard’s “inter-bank fees and related practices may be anti-competitive”.
Visa is already under investigation in Europe over similar practices.
The European Commission is investigating MasterCard over fees charged for card transactions made by people visiting Europe
MasterCard, which said it would “fully co-operate” with regulators, could be fined up to $740 million, or 10% of its 2012 revenue, if found guilty.
The credit card firm said that it always aimed “to balance the interests of both consumers and retailers”.
The investigation will examine payments made by people from outside the European Economic Authority (EEA) – the EU’s 27-member states as well as Norway, Liechtenstein and Iceland – who use their credit and debit cards when inside the area.
The EU said the main aim of its probe was to ensure consumers were not harmed.
“When a US tourist uses a Mastercard to make a purchase in [the European Economic Area], these fees can be quite high, generally much higher than those paid in Europe,” European Commission spokesman Antoine Colombani said.
In 2007, a similar probe led to the Commission banning MasterCard from charging cross-border fees within the European Economic Area.
The European Commission said payment cards were of “crucial importance” for cross-border and internet payments.
“It is therefore a priority for the European Commission to prevent competition distortions in inter-bank arrangements on fees,” it said.
As well as inter-bank fees paid by cardholders from non-EEA countries, the Commission said the probe would look at rules that obliged merchants to accept all types of MasterCard cards, even if some of them incur higher charges.
The probe will also look at MasterCard’s restrictions on merchants who wish to use banks outside their own country, which could be cheaper.
“Ultimately, such behavior is liable to slow down cross-border business and harm EU consumers,” it said.
The European Commission said it would submit proposed regulation by the middle of the year on inter-bank fees aimed at ensuring a level playing field for all card providers.
A new credit card rule going into effect Sunday, January 27, 2013, could cost you more when shopping with a credit card at some stores.
Visa and Mastercard have agreed to let merchants add a service charge equal to the cost of processing a credit transaction to the bottom line.
The cost of processing is usually 1.5 to 3%, and merchants are capped at a 4% fee under the agreement.
The rule change was made as part of settling an antitrust suit brought by retailers.
Merchants will still not be allowed to add a surcharge to debit card transactions.
However, few stores seem interested in raising their customer’s costs.
“We have discussed the settlement with many, many merchants, and not a single merchant we have spoken to plans to surcharge,” said Craig Sherman, spokesman for the National Retail Federation, which was not involved in the lawsuit.
Wal-Mart, Target, Sears and Home Depot all told NBC News that they had no plans to add a credit card surcharge.
California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas all ban credit card surcharges.
Both Visa and MasterCard have rules requiring retailers to handle credit cards the same way in every store regardless of location, so if a chain has a store in a state where surcharges are banned then none of its locations would be allowed to have a surcharge.
Under the settlement terms, a merchant adding surcharges on Visa or MasterCard would have to do the same with American Express cards, but that company prohibits surcharge fees.
“The bottom line is that very few retailers would be able to surcharge under the settlement, and that the vast majority don’t want to surcharge even if they could,” Craig Sherman said.
“In the brick-and-mortar world, no one who does any sort of volume business is going to want to surcharge because it will drive their customer crazy and slow down transactions,” agreed Ed Mierzwinski, Director of Consumer Programs at U.S. PIRG.
With the exception of small retailers, credit surcharges are not a major issue for most businesses.
A new credit card rule going into effect Sunday, January 27, 2013, could cost you more when shopping with a credit card at some stores
Still, over time they could become popular as a way for stores to make extra money.
That’s because stores already factor in the cost of processing a credit care when they price their merchandise. Unless they dropped their prices, second charge would be double-dipping at the loss of the consumer.
“We shouldn’t have gotten to the point, but unfortunately because of the court settlement we have,” said Edgar Dworsky, founder of ConsumerWorld.org.
“There’s no one standing up for consumers and saying that this is really bad.”
He notes that in Australia, where surcharging originated in 2003, extra charges have boomed to the point where one-third of retailers charge extra to use a credit card.
Advocacy group Consumer Action warns shoppers to watch their receipts and argue any fees that don’t belong.
“Customers shouldn’t stand for it,” said Ruth Susswein, Consumer Action’s deputy director of national priorities.
“Our advice is to tell them you don’t like the fee and this makes you want to take your business elsewhere.”
If a retailer plans to add a surcharge they are require to post a notification at the store’s entrance.
The exact surcharge per cent needn’t be disclosed until the sale.
Online stores with a surcharge will not be required to have a notice until shoppers reach the page where credit cards are first mentioned, which is most often the final step of checkout.
“We’re not convinced this is going to be an issue,” Ruth Susswein said.
“They may never do it, but as individual consumers we need to be aware.”