Archive · 9 Nov 2025
Visa, Mastercard Near Settlement to Lower Fees and Change Card Acceptance
Imagine you own a small shop and want to sell things.
Big companies like Visa and Mastercard, which help people pay with plastic cards, have rules about how much they charge you (the shop owner) for each sale.
These fees are called 'interchange fees.'
For a long time, shop owners have felt these fees are too high and unfair.
They also don't like that if they accept one type of Visa card, they have to accept all types.
Now, after many years of arguing in court, Visa and Mastercard are close to agreeing to lower these fees a little bit.
They might also let shops choose which types of cards they accept, maybe not accepting cards with lots of rewards if they cost too much.
This is like a big agreement to make things easier and perhaps cheaper for shops, and maybe for customers too.
This settlement still needs a judge to say it's okay.
Visa and Mastercard are reportedly close to settling a 20-year-old legal dispute with merchants.
The proposed settlement includes lowering credit-card interchange fees from around 2-2.5% to an average of 0.1 percentage point over several years.
Merchants may gain the ability to refuse specific card types, such as rewards cards, rather than accepting all cards from a network.
The dispute began in 2005 with merchants accusing Visa and Mastercard of anticompetitive fee and acceptance practices.
The deal requires court approval and could also address the practice of merchants surcharging customers for credit card payments.
- Who
- Visa, Mastercard, merchants, and large banks
- What
- Nearing a settlement to reduce interchange fees and alter card acceptance rules, ending a 20-year legal dispute.
- When
- Expected to be announced soon; the legal dispute began in 2005. A previous deal was rejected in March 2024.
- Where
- United States (implied by merchant lawsuits and credit card networks)
- Why
- To resolve accusations of anticompetitive practices concerning interchange fees and mandatory acceptance of all card types from a network.
Merchants
Visa & Mastercard
Interchange Fees
Merchants
Merchants have long argued that interchange fees, typically 2-2.5%, are anticompetitive and increase their costs.
Visa & Mastercard
Visa and Mastercard are proposing to lower these fees by an average of approximately a tenth of a percentage point over several years.
Card Acceptance Rules
Merchants
Merchants want the flexibility to decline specific types of credit cards, such as rewards cards with higher fees, without rejecting all cards from a network. They fear losing sales if they reject popular rewards cards.
Visa & Mastercard
The proposed settlement would loosen rules requiring merchants to accept all cards from a network if they accept one. Acceptance could be categorized, allowing merchants to differentiate between rewards, no-rewards, and commercial cards.
Surcharging
Merchants
Merchants have begun passing interchange fees to consumers through surcharges. Previous attempts to formalize surcharging in a settlement were rejected.
Visa & Mastercard
The new settlement being discussed also includes provisions for surcharging, which could allow merchants to add extra charges for credit card payments.
- Nature of Dispute
- Anticompetitive practices regarding interchange fees and mandatory acceptance of all card types from a network.
- Initiation Year
- 2005
- Current Fee Range (approx.)
- 2% - 2.5%
- Proposed Fee Reduction
- Average of 0.1 percentage point over several years
- Key Settlement Terms
- Lower interchange fees, categorized card acceptance (e.g., by rewards type), potential for merchant surcharging.
- Approval Required
- Court approval
- Impacted Parties
- Visa, Mastercard, merchants, consumers, large banks, and financial institutions issuing cards.
