A bill will set a maximum clearing commission, which the Ministry of Finance will supervise, and which will be lower than current commissions.
Sources inform ''Globes'' that the Ministry of Finance intends to initiate legislation after the elections to allow full cross-clearing in the entire credit card market, and force Isracard to permit clearing of its credit cards by Visa credit card companies.
The bill will set a maximum clearing commission (the fee paid by businesses to credit card companies), which the Ministry of Finance will supervise, and which will be lower than current commissions. A committee chaired by Accountant General Dr. Yaron Zalika is now formulating the bill.
Isracard charges a 1.8% commission on transactions, whereas Visa charges 1.4%. Each 0.1% clearing commission amounts to NIS 120 million, and a 0.5% cut in the commission will cost credit card companies, particularly Isracard, NIS 600 million a year. This will affect the value of Isracard, which plans to go public on the Tel Aviv Stock Exchange (TASE) in 2007.
Published by Globes [online], Israel business news - www.globes.co.il - on February 27, 2006