MasterCard responds to European Commission's Sector Inquiry into Payment Cards

WATERLOO, Belgium--(BUSINESS WIRE)--April 12, 2006--MasterCard notes the publication by the European Commission of the initial findings in its Sector Inquiry regarding payment cards. MasterCard is studying this lengthy report and will be responding with comments within the Commission's required deadline. At this stage, we are unable to comment further on the specifics of this paper.

MasterCard has always been committed to an open and competitive single market for card payments in Europe, which underpins the position of the European Commission. Indeed, MasterCard, working alongside the European banking community, is currently implementing major changes to the European cards landscape through delivery of the SEPA cards framework. MasterCard has already made, voluntarily, a number of changes to its rules and practices in order to encourage greater competition and more efficient card payments, and looks forward to continuing its work with the Commission and the banking community to achieve this end.

It is important to recognise that the European card businesses (both credit and debit) are complex and diverse, and that change must protect the integrity and viability of payments for all stakeholders. We therefore think it is unfortunate that the Commission has labelled the charges levied by banks on merchants for accepting payment cards as a "tax" on sales. Under this logic, every cost a retailer incurs could likewise be called a "tax". The truth is that cards are a more efficient, more secure and more convenient means of payment than cash for both consumers and for retailers. Reducing these charges on retailers, through regulatory intervention, would not make the costs of running a payment system disappear - rather, European citizens would end up paying a greater proportion of the costs for running card payment systems.

About MasterCard International:

MasterCard International is a leading global payments solutions company that provides a broad variety of innovative services in support of our global members' credit, deposit access, electronic cash, business-to-business and related payment programs. MasterCard manages a family of well-known, widely accepted payment card brands including MasterCard(R), Maestro(R) and Cirrus(R) and serves financial institutions, consumers and businesses in over 210 countries and territories. The MasterCard award-winning Priceless(R) advertising campaign is now seen in 105 countries and in 48 languages, giving the MasterCard brand a truly global reach and scope. For more information, go to www.mastercardinternational.com.

This press release contains forward-looking information. Although MasterCard believes that its expectations are based on reasonable assumptions, it can give no assurance that its objectives will be achieved. Important factors that could cause actual results to differ materially from forward-looking information contained in this press release include: global political and economic conditions; MasterCard's ability to achieve its strategic objectives; the performance of MasterCard's member financial institutions and the nature of MasterCard's business relationships with these institutions; substantial and increasingly intense competition in the global payments industry; the success of MasterCard's global advertising, sponsorship, promotion and merchant acceptance initiatives; the functionality and security of MasterCard's transaction processing systems; MasterCard's ability to adapt to industry trends with technological and payment program innovations; the resolution of certain legal proceedings and regulatory actions; changing market dynamics and the other risk factors disclosed in MasterCard Incorporated's most recent Annual Report on Form 10-K. MasterCard disclaims any obligation to publicly update or revise any forward-looking information.