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The settlement was a result of a long-running antitrust case in which the two credit card network giants allegedly overcharged merchants by exacting excessive interchange fees, also called swipe fees.
Swipe fees are often merchants’ second largest expense after labor and eventually get passed down to consumers, experts said. They already cost the average household more than $1,100 annually ...
In March 2024, a settlement in the injunctive relief portion of the payment card interchange fee case was announced to reduce what are known as "swipe fees" for merchants in the U.S. This change, set to last five years, was expected to save retailers about $30 billion and mark the end of a long-standing legal battle over antitrust issues ...
Interchange fees or "debit card swipe fees" are paid to banks by acquirers for the privilege of accepting payment cards. Merchants and card-issuing banks have long fought over these fees. Prior to the Durbin amendment, card swipe fees were previously unregulated and averaged about 44 cents per transaction. [3]
The Merchants Payments Coalition is fighting for a more competitive and transparent card fee system that better serves American consumers and merchants alike. [26] Because swipe fees are hidden, consumers are unable to weigh the benefits and costs associated with choosing a particular form of payment.
A complex set of variables, including the card type and even merchant type, determine these fees, though the Nilson Report estimates that they average around 2.2 percent. These fees are largely ...
If a merchant pays a $2 fee on a $100 transaction, about $1.60 of that goes to the customer's bank and a smaller amount goes to the merchant's bank, which together constitute an interchange fee.
The plaintiffs argued that the 24-cent cap is an "unreasonable interpretation" of the 2010 law, often called the Durbin Amendment, mandating a cap on debit card swipe fees. [ 6 ] The Durbin Amendment , passed as part of the Dodd-Frank financial reform legislation in 2010, required the Federal Reserve to limit fees charged to retailers for debit ...