The Competition Authority of Turkey is investigating Mastercard and Visa to ascertain whether their scheme rules have limited the services that payment institutions can offer to merchants abroad.

Investigation into Possible Rule Violations

According to the board, this investigation was initiated because there are concerns that both companies might be violating competition rules by making it difficult for payment service providers to operate internationally. This could involve not allowing overseas businesses to utilize banks’ payment infrastructure under the scope of Banking Law number 5411.

Payment institutions in Turkey have the capability to offer services to consumers who wish to make payments to merchants abroad through bilateral agreements. Under such agreements, international transactions are localized, and these transactions can be processed without Mastercard or Visa’s cross-border transaction fees.

Findings from on-site investigations revealed that Visa and Mastercard were able to hinder the operations of payment institutions entering into these bilateral agreements by using various methods, including imposing sanctions against banks for allegedly violating their scheme rules.

Further Investigation

In addition to this investigation, another probe has been launched on the global card payment systems market activities of Mastercard and Visa. The focus will be on whether these companies have prevented merchants from using card payments and POS infrastructure abroad and removed alternative payment solutions.

The lack of competition in this area benefits both Mastercard and Visa, as it has led to steadily increasing card processing fees for merchants. Since 2017, Visa and Mastercard have raised rates by at least 25% above inflation. Post-Brexit, Mastercard increased cross-border interchange fees between the UK and the EU fivefold, resulting in significant additional costs for businesses and consumers.