Visa and Mastercard to Cut Merchant Fees in New Settlement
Visa and Mastercard are close to reaching a major settlement with merchants, according to the Wall Street Journal. The deal would reduce the fees stores pay and give them more freedom to reject certain credit cards.
Sources said the companies plan to lower interchange fees, which currently range from 2% to 2.5% per transaction, by about 0.1 percentage points over several years. This move could ease costs for businesses, especially small retailers.
In addition, Visa and Mastercard may relax the rule that forces merchants to accept all card types if they accept one. This change would let retailers decide which card programs to support, improving flexibility and control.
A Long Running Dispute
The settlement would finally end a legal battle dating back to 2005. The agreement could divide card acceptance into different categories, such as rewards, non rewards, and commercial cards.
Last year, both companies agreed to a $30 billion settlement to cap card fees and reduce swipe rates for several years. They denied any wrongdoing but said the deal aimed to bring stability and predictability for all parties.
Merchants have long criticized high swipe fees and “anti steering” rules, which prevent stores from guiding customers toward cheaper payment options. Therefore, this new deal could represent a turning point for fairer payment systems.
Discussions also include potential changes to surcharging rules, according to the Journal. Neither Visa nor Mastercard has publicly commented yet, but the deal is reportedly in its final stages.
