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

A settlement has been reached between Visa, Mastercard, and banks that use these networks to reduce merchant fees. The agreement is projected to decrease swipe fees paid by merchants for Visa or Mastercard purchases by $30 billion over the next five years.

The case, which was filed in 2005, focused on reducing the high swipe fees that merchants had to pay during credit card transactions. Merchants typically paid about 2% of the total transaction amount, with costs possibly rising to 4% for certain premium rewards cards. Under the settlement, these fees will be reduced by at least 0.04 percentage points for a minimum of three years. Despite this reduction, Visa and Mastercard cardholders will not see any changes in their rewards programs or credit access.

In response to the settlement, credit card companies like Visa and Mastercard confirmed that their rewards programs and credit access would remain the same for cardholders. However, recent news of a potential merger between Discover and Capital One suggests ongoing changes in the credit card industry. Visa and Mastercard stock prices experienced slight increases following the announcement of the settlement, indicating investor confidence in the deal.

It is important to note that the settlement has not yet been finalized and is awaiting approval from the US District Court for the Eastern District of New York. The case could also be subject to appeal, extending an already long legal process. This story is still developing, and updates will be provided as more information becomes available.

By Riley Johnson

As a content writer at newsmol.com, I dive into the depths of information to craft compelling stories that captivate and inform readers. With a keen eye for detail and a passion for storytelling, I strive to create engaging content that resonates with our audience. Whether it's breaking news, in-depth features, or thought-provoking opinion pieces, I am dedicated to delivering high-quality, informative content that keeps readers coming back for more. My goal is to bring a fresh perspective to every article I write and to make a meaningful impact through the power of words.

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