isa U.S.A. took the wind from MasterCard Worldwide's sails when it posted its interchange rates online Oct. 17, two weeks ahead of its competitor. MasterCard had announced early on its rates would enter the public domain Nov. 1.

"Being more open about how we operate as a company helps to foster and expand our working relationships with new and existing partners and other parties who seek to better understand our business," Rhonda Bentz, Vice President for Visa, said in a written statement. "By posting our 'wholesale' rates, Visa U.S.A. is providing more clarity into the Visa system than is seen in any other retail environment."

MasterCard's rates have generally been available to merchants through requests to acquirers or other card acceptance providers, according to the company.

"MasterCard believes that providing easy access to our interchange rates will provide additional transparency to merchants," the rate guide states. "MasterCard is confident that this document provides merchants with the information needed to understand the interchange rates and structure and determine which rates may apply to their transactions."

Visa's rate posting is consistent with the card Association's efforts to provide greater clarity about its business, Bentz stated. Visa's operating regulations, however, are still considered proprietary information. Visa discloses the regulations to "qualified U.S. merchants and third-party agents," she added.

MasterCard's rate document numbers 72 pages. It provides detailed information on authorization and magnetic data requirements, authorization variances, additional qualifying criteria, and a glossary of terms.

Visa's document, at five pages, is concise and easy to comprehend but lacks any explanation of acronyms or definition of categories, such as "Performance Threshold III."

Clarity or confusion?

With both rate structures now available to the public, whether clarity has been achieved is a question of opinion. Mallory Duncan, Chairman of the Merchants Payments Coalition - an organization dedicated to fighting the current interchange system - released a statement the day after Visa posted its rates: "The report shows a bewildering array of rates for different cards, merchants and types of transactions, which emphasizes the opacity of interchange.

"Without the operating rules that govern how these fees are applied, this announcement falls far short of the disclosure that is required and that Visa promised," Duncan stated. Mitch Goldstone, President of 30 Minute Photos Etc. and co-editor of WayTooHigh.com, said the card Associations "have all their oars in the water now, but the current is too great," referring to the swell of merchant anger over discount fees. Goldstone is a plaintiff in the class-action lawsuit brought by merchants against Visa and MasterCard.

"If I, myself, as the lead plaintiff have not a clue what these rates are, ... how are merchants going to figure it out?" Goldstone said. "The disclosure I want to see is the exact [interchange] fee on every credit card receipt."

Goldstone is advocating that bankcard receipts be imprinted with exact interchange fees per transaction by Nov. 24, or "black Friday," as it is known in retail circles for being one of the busiest shopping days of the year. "It would signal an important message to retailers that [the Associations] indeed are concerned about cardholders and retailers," Goldstone said.

Both Visa's and MasterCard's interchange rates are published in this issue of The Green Sheet.