After nearly 20 years of litigation, Visa announced it has agreed to a landmark settlement with U.S. merchants, more than 90 percent of which are small businesses, lowering credit interchange rates and capping those rates into 2030. The settlement also provides updates to several key network rules giving merchants more choice in how they accept digital payments.
The agreement’s multi-year benefits for businesses include:
Lower interchange rates. The settlement will reduce credit interchange rates for U.S. merchants, comprised largely of small businesses.
Interchange rates will not go up. The agreement will cap the reduced credit interchange rates for five years, providing an unprecedented level of cost certainty long sought by merchants.
New ways to manage costs. The settlement gives merchants greater flexibility at the point-of-sale, including the opportunity to steer to preferred payment methods and more optionality around surcharging. It also provides funding for new programs to educate small businesses about payment acceptance options and how to best manage costs.
“By negotiating directly with merchants, we have reached a settlement with meaningful concessions that address true pain points small businesses have identified,” said Kim Lawrence, President, North America, Visa. “Importantly, we are making these concessions while also maintaining the safety, security, innovation, protections, rewards and access to credit that are so important to millions of Americans and to our economy.”
The agreement – agreed also by Mastercard, provides all merchants with clarity and certainty on several areas related to their acceptance of payment cards, including simplified surcharging and discounting rules. „As part of the settlement agreement, the networks will activate a simplified approach to credit card transaction surcharging, providing merchants more optionality. These rules will maintain core consumer protections and transparency, replacing standards that had been updated in 2012.” – Mastercard said in a press release.
“This agreement brings closure to a long-standing dispute by delivering substantial certainty and value to business owners, including flexibility in how they manage acceptance of card programs,” said Rob Beard, Chief Legal Officer, General Counsel and Head of Global Policy at Mastercard. “As the court reviews the settlement, we will focus our energy on continuing to provide consumers, small businesses and all business owners what they expect from Mastercard – a better payments experience, strong value and peace of mind.”
Today’s settlement agreement with merchants resolves claims against Visa, Mastercard and other defendants brought by the injunctive relief class in the lawsuit entitled In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation.
The settlement is subject to final approval by the Eastern District Court of New York.
Mastercard added: „Upon final approval of the class settlement by the court, Mastercard will have resolved the vast majority of all pending U.S. merchant litigations that are directed at seeking changes to the company’s interchange structure and merchant acceptance rules.”
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
