IT WAS refreshing to read Jeff Jacoby's defense of the bank card interchange rate system ("Leave the 'plastic' alone," Op-ed, April 30). As one who has spent 22 years in the trenches on the merchant acquiring side of the bank card industry, I'm baffled by merchants' disdain for a payment system that has brought them incalculable financial benefit.
Imagine 1960. A hypothetical meeting of owners and CEOs representing millions of businesses is held. A payment option is announced that is faster, improves productivity, and enables virtually all store shoppers to become buyers - and to buy more and more often - with no merchant credit risk. Gasps are heard when the audience is told that 1 billion consumers worldwide could also make a purchase by mail or telephone. The cost: just a 2 percent discount to the face value of any sale. No reasonable mind could doubt that all in attendance at that hypothetical gathering would have jumped at this prospect, and would have seen the cost for acceptance as a bargain.
Unfortunately, like the nation, today's US business world is populated by too many so-called victims looking for "fairness." The fact is, both Visa's and MasterCard's total value proposition is compelling and cost-effective for merchant and cardholder alike.
DAVID L. TEPOORTEN
Rochester Hills, Mich.
Consumers who use Visa and MasterCard can choose from a wide range of credit card offerings with varying percentage rates and reward programs, and issued by different banks, but the retailers have only one choice: Inconvenience your customers or pay the fee. Visa and MasterCard have no clear incentive to keep interchange fees low, and retailers have few other options. That seems a lot like a monopoly to me, and if it's a monopoly, government may need to step in.
DEREK HAYS
Cambridge
