Visa Inc. (V) shares experienced a significant drop on Tuesday following reports that the U.S. Department of Justice (DOJ) is preparing to file an antitrust lawsuit against the global payments company.
According to Bloomberg, the DOJ is poised to accuse Visa of monopolizing the U.S. debit card market. The lawsuit alleges that Visa has engaged in anti-competitive practices, including exclusivity agreements that effectively block competitors from entering the market. These allegations stem from years of investigation into Visa’s business practices, particularly following its failed attempt to acquire Plaid Inc. in 2021.
The DOJ is also examining Visa’s pricing for its “tokenization” technology, which could have also hindered the expansion of rival networks and technology companies seeking to enter the market. This lawsuit represents part of a broader regulatory crackdown by the DOJ targeting monopolistic practices across various industries. The Justice Department has recently been investigating other large tech companies, including Alphabet and NVIDIA Inc. (NVDA), as part of its efforts to curb anti-competitive behavior.
Visa’s stock price took a hit, falling by 4.17% to $276.60 according to Benzinga Pro. This lawsuit adds another layer of complexity to the already competitive landscape of the payments industry. It remains to be seen how this case will unfold and what impact it will have on Visa’s future operations.
