An estimated 7 million retailers will be affected by a proposed settlement in the Payment Card Interchange Fee and Merchant Discount Antitrust Litigation case.
According to Reuters, it has been announced that Visa and MasterCard along with their card issuing banks have agreed to settle the Payment Card Interchange Fee and Merchant Discount Antitrust Litigation case with U.S. retailers for $7.25 billion. If approved by the judge, it would be the largest antitrust settlement in U.S. history.
According to reports, the settlement will include provision to allow stores to surcharge customers extra in an attempt to steer customers toward less expensive payments (although certain states laws prohibit the practice), will pay stores $6 billion and will lower interchange fees by the equivalent of 0.10% (10 basis points or $1 per $1,000 in sales) for 8 months valued at $1.2 billion with an additional $525 million paid to stores suing individually.
Stay tuned for more coverage on this settlement. But be careful. In the 2003 Visa and MasterCard settlement of a lawsuit by stores over the the "honor all cards" rules, $3 billion was paid out and many merchants gave up a third or more of their take to law firm solicitations. Just be patient. The details will come out on what if anything merchants need to do. In regards to the lower Interchange, as we continue to preach, move to a direct Interchange pass through service provider to take advantage of these savings (have we mentioned that's what we do?)