US judge approves $38B Visa, Mastercard swipe-fee settlement

• Swipe fees for Visa and Mastercard totaled $132.8 billion in the U.S. in 2025 (up from $111.2 billion in 2024), with an average fee of 2.36%
• The settlement proposes lowering swipe fees by 0.1 percentage point for five years and capping standard consumer rates at 1.25% for eight years, with experts projecting $38 billion in merchant savings by 2031
• Major retailers including Walmart opposed the deal, calling it a 'gift' to card networks that locks in anticompetitive conduct, while supporters include the Electronic Payments Coalition representing card networks and major banks

Summary: US Judge Approves $38B Visa, Mastercard Swipe-Fee Settlement

A U.S. District Judge in Brooklyn granted preliminary approval to a revised $38 billion settlement between Visa and Mastercard and merchants over allegedly excessive credit card swipe fees. The ruling comes nearly two years after a previous $30 billion settlement was rejected as inadequate.

Key Details:

The settlement addresses litigation dating back to 2005, in which merchants accused Visa, Mastercard, and banks of antitrust violations through excessive interchange fees. Swipe fees for both networks totaled $126.4 billion in the U.S. in 2025, up from $111.2 billion in 2024 and $25.6 billion in 2009, with an average fee of 2.36%.

Settlement Terms:

• Swipe fees reduced by 0.1 percentage points for five years
• Standard consumer rates capped at 1.25% for eight years
• Merchants gain flexibility to impose surcharges and choose which card categories to accept (commercial, premium consumer, standard consumer)
• Effectively ends the "Honor All Cards" rule requiring acceptance of all network cards

Market Reaction:

Supporters, including the Electronic Payments Coalition and major issuers (Bank of America, Capital One, Chase, Citibank), backed the agreement. Experts predict $38 billion in merchant savings by 2031 and $224 billion in total benefits.

However, major opponents including Walmart, National Retail Federation, and National Association of Convenience Stores argued the settlement locks in anticompetitive practices and forces merchants to continue accepting high-fee rewards cards or lose revenue.

The settlement represents a significant development in the long-standing dispute over payment processing costs affecting retailers and consumers nationwide.