EU regulators have intensified their investigation into Visa (NYSE:V) and Mastercard (NYSE:MA), issuing a new questionnaire targeting terminal providers and payment companies. This follows last month’s survey of merchants, marking the European Commission’s most thorough scrutiny of card scheme fees since the probe commenced in September.

Details of the New Questionnaire

The latest inquiries require respondents to outline all fees and services introduced, revised, or discontinued by Visa and Mastercard from 2017 to 2024. Key focus areas include:

• Mandatory vs. Optional Fees: What fees are essential for acquirers?

• Fee Transparency: Are fee structures clearly communicated, and is there sufficient notice for changes?

• Complaint Handling: Have there been grievances reported by payment firms in the past seven years, and were they addressed timely?

Market Reaction and Analyst Ratings

Although shares of both companies reacted moderately, they remain under pressure as numerous analysts adjust their outlooks. The median price target for Visa is set at $260, while Mastercard’s stands at $410, based on recent adjustments.

Effects on the Payments Sector

Given that card networks account for roughly two-thirds of eurozone transactions, any findings of anticompetitive behavior could lead to fee reductions or possibly structural changes within the card processing industry. For terminal providers and fintechs, successful scrutiny may lower costs and prompt the entry of new players, albeit at a potential revenue hit for established networks.

With the expansion of its investigation, the EU raises the stakes for global card networks. All eyes are on forthcoming decisions that may result in formal actions or commitments to amend fee practices.