The major US supermarket chain, Kroger, have said they will stop accepting Visa credit cards at its 142 supermarkets and 108 petrol stations across seven states. On April 3, its Smith’s Food & Drug Stores division will stop accepting Visa credit cards, although prepaid cards and debit cards will still be accepted. They are acting out of frustration regarding Visa’s high transaction fees.
“Visa has been misusing its position and charging retailers excessive fees for a long time,” said Mike Schlotman, Kroger’s Executive Vice President and CFO. “They conceal from customers what Visa and its banks charge retailers to accept Visa credit cards. At Smith’s, Visa’s credit card fees are higher than any other credit card brand that we accept. Visa’s excessive fees and unfairness cannot continue to go unchecked.”
Morgan Creek Digital founder Anthony Pompliano proposed that Kroger should deploy the Lightning Network in its stores, tweeting: “The Morgan Creek Digital team will fly to meet them and get them hooked up with the Lightning Network nationwide”. Pompliano later tweeted that the negotiations had begun.
The Lightning Network offers instant payments, scalability, cross blockchains and low costs, with the latter being of paramount importance to Kroger. It works by creating an interlacing network of two-participant payment channels, a way for two people to transact only with one another. The website states: “By using real Bitcoin/blockchain transactions and using its native smart contract scripting language, it is possible to create a secure network of participants which are able to transact at high volume and high speed”.
Visa Say Shoppers Are In The “Middle Of A Business Dispute”
Visa stated that it was “unfair and disappointing” that Kroger was putting shoppers in the middle of a business dispute. “We have put forward a number of solutions to allow our cardholders to continue using their preferred Visa credit cards at Foods Co. and Smith’s without Kroger-imposed restrictions, and we continue to work toward a resolution,” the company said.
Kroger has close to 2800 stores in 35 states and annual sales of more than $115 billion, they rank as one of the world’s largest retailers.
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