Visa, Mastercard and their competitors forced to cut swipe fees

In yet another encouraging example of excessive fees being challenged, Visa, Mastercard and other card issuing banks agreed to settle lawsuits by merchants by cutting their swipe/ interchange fees by 0.04 percentage points for five years.

'The legal team that struck the deal for the merchants said that would amount to eliminating $30 billion in fees over five years. The networks and banks collected $72 billion in total interchange fees last year, according to card data company Nilson Report.

The proposed settlement would create some changes to give merchants more choice on accepting cards, allowing them to guide consumers to cards that have lower fees.’

’ Visa, Mastercard and the banks have already settled part of the suit, agreeing to pay the merchants nearly $6 billion. Last year, an appeals court affirmed that settlement.’

However, Doug Kantor, general counsel of the National Association of Convenience Stores, said the settlement doesn’t go far enough to tackle address the alleged fixing of swipe fees by Visa/ Mastercard and banks.