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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 ...
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.
Currently, swipe fees average about 2% per transaction and are only lowered by “at least 0.04 percentage points.” This means on a $100 sale, the $2 fee will be reduced to a maximum of $1.96.
Merchants lobbied heavily for a rule to limit debit card swipe fees. [4] They accomplished this when the Durbin amendment passed with the Dodd-Frank financial reform legislation on July 21, 2010. [5] This was considered a major loss for banks, who receive billions of dollars a year in income from swipe fees. [6]
An interchange fee is a fee paid between banks for the acceptance of card-based transactions. Usually for sales/services transactions it is a fee that a merchant's bank (the "acquiring bank") pays a customer's bank (the "issuing bank").
Typically, swipe fees cost merchants 2% of the total transaction a customer makes — but can be as much as 4% for some premium rewards cards, according to the National Retail Federation. The ...
Whenever a merchant accepts a credit card payment, the credit card network that processes the payment will charge a merchant fee. The merchant is expected to cover this fee. However, those fees ...
Within the first year, average fees fell from 44 cents to 24 cents per swipe. In response, banks largely did away with debit reward programs and other consumer benefits such as free checking accounts.