China asks Visa, Mastercard to cut card fees, Bloomberg News reports

(Reuters) -China is pushing for Visa and Mastercard to lower their bank card transaction fees in the country to encourage spending by foreign visitors, Bloomberg News reported on Friday, citing a person familiar with the matter.

The Payment & Clearing Association of China is proposing lowering the fees charged on foreign card transactions to 1.5% from between 2% and 3%, the report said.

If implemented, the proposal could cut costs for foreign nationals visiting China. While merchants bear the fees charged by Visa and Mastercard, they often pass these on to their customers through price hikes.

Regulators around the world have been trying to rein in the fees Visa and Mastercard charge merchants for processing transactions. Earlier this year, the duo reached one of the largest settlements in U.S. history to limit credit and debit card fees.

But a New York judge has indicated she would reject the agreement that would have ended longstanding litigation in the U.S. over the fees.

Mastercard told Bloomberg it had received the proposal from the Payment & Clearing Association of China and would work with partners to lower costs for local merchants accepting foreign bank cards.

Visa and Mastercard did not immediately reply to Reuters requests for comment.

So far this year, shares of both companies have gained more than 6% each.

(Reporting by Disha Mishra and Niket Nishant in Bengaluru; Editing by Savio D'Souza, Rashmi Aich and Devika Syamnath)