Wal-Mart Stores, Inc. announced that effective Oct. 13, 2001, it will no longer accept Interlink-serviced debit cards due to a unilateral 125 percent increase in transaction fees. A subsidiary of Visa International, Interlink is increasing the fees it charges for each individual debit-card transaction from 20 cents to 45 cents.
“This is an outrageous action by Interlink and Visa,” said Mike Cook, assistant treasurer for Wal-Mart Stores, Inc. “This is a hidden tax on consumers that ultimately will result in higher prices for retail goods. As America’s every day low-price leader, Wal-Mart cannot go along with this.”
Cook added that less than 10 percent of Wal-Mart’s total debit card business is handled by the Interlink network.
Wal-Mart will continue to accept other PIN-based debit cards such as Star, Pulse, NYCE and AFFN. This action also will have no impact on standard credit card transactions.
Visa offered to pay Wal-Mart as much as $32 million in incentive payments if the company would accept the increased transaction fees by Interlink. Wal-Mart also rejected this offer “because it is not in the best interests of our customers,” Cook said.
“We sincerely regret any inconvenience to our customers as a result of this,” said Cook. “We realize it means some customers will have to use other forms of payment, and some may choose to change their debit-card providers as a result.”
The action is unfortunate, Cook said, since debit transactions in which the customer enters a personal identification number (PIN) are among the safest and most frequently used methods of electronic payment in retail stores today. If a PIN-based debit card is stolen or lost, it cannot be used without the PIN or access number. Each year, Wal-Mart handles more than 350 million individual customer transactions through PIN-based debit transactions.
With annual sales of $191 billion, Wal-Mart Stores, Inc. operates more than 2,700 discount stores, Supercenters and Neighborhood Markets, and more than 490 SAM’S CLUBS in the United States. Internationally, the company operates more than 1,100 units. Wal-Mart employs 1.2 million associates worldwide. The company’s securities are listed on the New York and Pacific stock exchanges under the symbol WMT. More information about Wal-Mart can be located on-line at and . The SAM’S CLUB Web site can be accessed at .