Visa, Mastercard reach revised swipe-fee settlement with merchants

Core Viewpoint - Visa and Mastercard have reached a revised settlement with merchants regarding swipe fees, following a judge's rejection of a previous $30 billion agreement as inadequate [1][4]. Group 1: Settlement Details - The new settlement requires court approval and mandates Visa and Mastercard to reduce swipe fees by 0.1 percentage points for five years, with current rates typically ranging from 2% to 2.5% [2]. - Standard consumer rates will be capped at 1.25% until the agreement expires, and merchants will gain more options to impose surcharges on credit card payments [3]. - Swipe fees in the U.S. totaled $111.2 billion in 2024, an increase from $100.8 billion in 2023, and quadruple the level in 2009 [3]. Group 2: Implications for Merchants - Visa stated that the settlement offers "meaningful relief" and more flexibility for merchants of all sizes in managing payment acceptance [4]. - Mastercard emphasized that smaller merchants would particularly benefit from lower costs and simpler rules, enhancing the overall payments experience for businesses and consumers [4]. - The settlement is likely to face opposition from some merchants, as it requires approval from U.S. District Judge Margo Brodie, who previously rejected the earlier agreement [4][5]. Group 3: Legal Context - The settlement addresses long-standing accusations against Visa and Mastercard for violating U.S. antitrust laws, particularly concerning the collection of swipe fees and enforcement of "anti-steering" rules that limit merchants' ability to direct customers to cheaper payment options [1][6].