Steinitz wants coalition discipline in war on Isracard
Finance Minister is upping the ante in the government's campaign to force competition on the country's largest credit card provider.
Finance Minister Yuval Steinitz is upping the ante in the government's campaign to force competition on Isracard, the country's largest credit card provider.
After TheMarker reported that the company was pressuring Knesset members in an attempt to scuttle an amendment that would force it to let other credit card providers clear transactions made with its cards, Steinitz asked coalition whip MK Zeev Elkin to impose coalition discipline during the vote in the Knesset Economics Committee.
The government-sponsored amendment would apply to all credit card providers that hold more than 10% of the market, but Isracard has the most to lose from it: It controls 17% of the market, the largest share held by any single company. Currently, Isracard is refusing to let other providers clear transactions made with its credit cards, which means that business owners need to go through Isracard if they want to be able to accept the company's credit cards.
The amendment is intended to increase competition in the credit card market and thus reduce fees.
After it receives committee approval, the amendment will be sent back to the Knesset plenum for a second and third reading, and if it passes, it will then become law.
TheMarker reported two days ago that Isracard was pressuring MKs to change the amendment's wording to include companies with more than 20% of the market - thereby excluding Isracard. Isracard CEO Dov Kotler, Chairman Irit Izakson and lobbyist Dafna Cohen had been contacting members of the Economics Committee, asking them to vote against the bill.
Isracard's executives had also argued that their brand deserved special protection because it was "blue-and-white," as opposed to, say, Visa.
Knesset Economics Committee Chairman MK Carmel Shama-Hacohen retorted, "If we're talking about protecting the 'blue-and-white,' then we need to be protecting Israeli consumers and businesses before we protect a 'blue-and-white' brand."
Meanwhile, lobbyists on behalf of Visa Cal and Gama Management and Clearing have been calling on Knesset members to approve the amendment.