Mon. Jun 17th, 2024
Visa and Mastercard Reach $30 Billion Settlement to Reduce Merchant Fees

In a major development, Visa and Mastercard have reached a settlement with merchants aimed at reducing merchant fees. The case, which has been ongoing for decades, involves not only the credit card networks but also the banks that issue cards with them. The settlement is expected to reduce swipe fees paid by merchants when customers use Visa or Mastercard by $30 billion over a five-year period.

The agreement, which only applies to US merchants, is the result of a lawsuit filed in 2005. However, it must still receive approval from the US District Court for the Eastern District of New York. Swipe fees typically cost merchants around 2% of the total transaction, but for premium rewards cards, it can go up to 4%. The settlement would lower these fees by at least 0.04 percentage points for a minimum of three years.

Visa and Mastercard have assured that the rewards received by cardholders will not be impacted by the settlement and Americans’ access to credit will not be restricted as a result either. Mastercard spokesman Seth Eisen confirmed that the settlement would not affect rewards or credit access for cardholders. In related news, Discover and Capital One recently announced a merger that will create the largest credit card company in the country upon approval by regulators and shareholders. Following

By Aiden Nguyen

As a content writer at newscholarly.com, I delve into the realms of storytelling with the power of words. With a knack for research and a passion for crafting compelling narratives, I strive to bring forth engaging and informative articles for our readers. From decoding complex concepts to unraveling current events, I aim to captivate and educate through the art of writing. Join me on this journey as we explore the ever-evolving landscape of news and knowledge together.

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