Specifically, we are focused on:
The connection between retailers and their customers is not always direct. Payment processing, internet access, search, and for some, online marketplaces, are examples of economic essentials that are controlled by third party entities. Many of these entities operate in ecosystems with far less competition than the retail industry. The absence of robust competition in these adjacent industries presents serious risks to retailers in the form of higher costs and disruptions to the overall customer experience.
In addition, there are issues with super-dominant marketplaces that warrant special attention. Specifically, policymakers should consider potentially anticompetitive behavior of super-dominant marketplaces related to the authorized sale of brands and goods. RILA is also concerned about the potential erosion of consumer trust as a result of inferior product quality through the proliferation of counterfeit and stolen goods. Finally, RILA is concerned about the price harms to consumers when super-dominant marketplaces are combined with limited consumer information pathways.
- Closely examine technology platforms
- Scrutinize information infrastructure firms
- Carefully consider anticompetitive data use
- Review competitor cooperation that is no longer technologically necessary – particularly in the area of credit interchange
Reforming the Payments Ecosystem
Merchants in the United States pay some of the highest interchange rates or “swipe fees” in the world, costing merchants more than $80 billion each year. The global card companies, along with major issuers, establish these rates in an anticompetitive manner. While past regulatory reforms achieved by RILA have resulted in meaningful improvements, more is needed to reign in a myriad of anticompetitive practices.
In partnership with the Retail Litigation Center, RILA is pursuing legislative and legal remedies. RILA is currently working with key regulators to encourage action that will enable retailers’ right to route online debit transactions over networks other than Visa and Mastercard signature networks. The ability to do so will bring meaningful competition to online debit routing and save merchants hundreds of millions of dollars.
Dive deeper: Leading Retailers Want Action on Payment Reforms (2/11/20)
For more information about RILA’s work to increase competition across the retail industry, please contact Vice President of Innovation Nicholas Ahrens.