Does The Visa And Mastercard Settlement Really Matter?
Interchange fee reductions don't always benefit everyone but some win big
Disclaimer: views expressed here are my own and do not represent any other organisation
Recently, the big news in payments was the settlement that Visa and Mastercard reached with a group of merchants in the United States. The case originated as a Class Action Complaint on June 22nd, 2005. The Class Settlement Agreement of March 25th 2024, brings the case to a close - at least for now. (A class action lawsuit allows various parties to come together to make a case on behalf of a larger group.) The result was a series of changes to the fees businesses pay for accepting card payments. Reuters led with the headline Visa, Mastercard reach $30 billion settlement over credit card fees. $30bn is a significant number in anyone’s book, but $30bn did not change hands here. So what is the actual impact, and does it matter?
I’m not going to re-cap every detail of the case. (Some valuabl…