THE chair of the Senate Judiciary Committee on Monday requested the CEOs of American Airlines, United Airlines, Visa and Mastercard to testify at an April 9 listening to on bank card competitors, in keeping with letters seen by Reuters.
Senator Dick Durbin mentioned in a press release to Reuters that American Airlines and United Airlines have “aggressively opposed efforts to bring competition to the credit card market in order to protect the billions of dollars in windfall profits their companies collect through their co-branded credit cards. These airlines have become credit card companies that fly planes.”
The airways and bank card corporations didn’t instantly remark.
Durbin mentioned it was vital for the CEOs to testify “in defence of a status quo that allowed Visa and Mastercard to levy a total of US$93 billion in credit card fees on consumers, small businesses, and others in 2022 alone.”
Major airways closely lobbied Congress final yr to reject laws co-sponsored by Durbin and Republican Senator Roger Marshall they are saying threatens their capability to supply rewards bank cards that give shoppers frequent flyer miles for making transactions.
Durbin’s letter mentioned United’s Scott Kirby and American’s Robert Isom had beforehand rejected requests to seem.
In December, Reuters first reported the US Transportation Department is scrutinising the frequent flyer programmes of main US airways for potential misleading or unfair practices.
In October, Durbin and Marshal requested the Transportation Department and Consumer Financial Protection Bureau about “troubling reports” of unfair and misleading practices in airways’ frequent flyer and loyalty programmes.
Airlines say there are at the very least 30 million US airline business bank card holders, and the playing cards “make travel more accessible and affordable.” They cite Federal Reserve information that 97 per cent of whole bank card spending is charged to varied rewards accounts.
Durbin says the invoice would handle “outrageous” charges charged by Visa and Mastercard, and increase competitors by directing the Federal Reserve to make sure that giant credit score card-issuing banks provide a selection of at the very least two networks over which an digital credit score transaction could also be processed. REUTERS
Source: www.businesstimes.com.sg”