Historic Settlement Set to Revolutionize US Merchant Fees: Visa and Mastercard Agree to Lower Swipe Fees by $30 Billion

Visa and Mastercard Reach $30 Billion Settlement to Reduce Merchant Fees

In a major development for US merchants, Visa and Mastercard have reached a settlement aimed at lowering merchant fees. The case has been ongoing for decades, involving 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.

This agreement, which applies only 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. Under the settlement, swipe fees paid by merchants will be lowered by at least 0.04 percentage points for a minimum of three years.

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 this was true in a statement on Monday.

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 the announcement of the settlement, shares of Visa and Mastercard slightly increased on Wednesday. This story is still unfolding and will be updated as more information becomes available.

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