Landmark Visa, Mastercard Settlement Will Slash $30 Billion Swipe Fees for Retailers

Visa and Mastercard have agreed to a landmark settlement, which is estimated to save retailers across the United States nearly $30 billion on swipe fees alone in five years. The settlement, announced on Tuesday, would resolve a 2005 class action antitrust lawsuit filed by a group of mostly small retailers who accused the card networks of colluding with some of the top U.S. banks to set credit card interchange fees at anti-competitive levels. Interchange fees, commonly called a “swipe fee,” are what banks charge merchants each time a customer makes a purchase using a credit card they issue. The fees are then passed on to the customer. While Visa and Mastercard don’t earn any money from interchange fees, they have raised the rates significantly over the years to the point that many small businesses add a surcharge to bills for customers paying with credit cards to encourage cash transactions....