The Department of Justice has filed an antitrust lawsuit against Visa, accusing the company of maintaining an illegal monopoly in the debit network market and attempting to stifle competition, including from fintech companies like PayPal and Square.
The lawsuit follows a years-long investigation into Visa’s business practices, which the company first revealed in 2021.
US Attorney General Merrick Garland stated that Visa’s dominance allows it to impose excessive fees, which are passed on to consumers through higher prices or reduced service quality. “Visa’s unlawful conduct affects not just the price of one thing — but the price of nearly everything,” Garland emphasized.
The government’s complaint highlights that over 60% of debit transactions in the U.S. are processed through Visa’s network, with the company making over $7 billion annually in processing fees. The DOJ claims Visa uses “exclusionary agreements” to limit competition and has attempted to quash rivals, particularly fintech companies and smaller debit networks. The complaint also points out that Visa executives view Apple as a significant threat to their business.
This isn’t the first time Visa has faced antitrust scrutiny. In 2020, the DOJ blocked Visa’s $5.3 billion acquisition of fintech firm Plaid, arguing it was an attempt to eliminate a potential competitor. Visa ultimately abandoned the deal in 2021 after the DOJ’s intervention.
The lawsuit marks another significant step by regulators to challenge the power of large payment processors, which have increasingly become gatekeepers in the digital economy.
