On Nov. 10, 2025, Visa and Mastercard announced a revised settlement with U.S. merchants that have accused the card networks and issuing banks of charging excessive “swipe” (interchange) fees. The accord, which must be approved by U.S. District Judge Margo Brodie in Brooklyn, follows the rejection in June 2024 of a prior $30 billion deal the judge deemed inadequate. Under the new terms, the card networks would reduce typical swipe rates by 0.1 percentage point for five years and give merchants expanded ability to accept or decline categories of cards and to apply surcharges. Neither network admitted wrongdoing; the settlement aims to end roughly two decades of antitrust litigation over payment-network practices.
Key Takeaways
- Visa and Mastercard have agreed to a revised settlement that lowers swipe fees by 0.1 percentage point for five years, subject to court approval.
- Standard consumer card rates would be capped at 1.25% for the duration of the agreement, and merchants may choose whether to accept certain card categories, including premium and commercial cards.
- Merchants will gain expanded options to impose surcharges or steer customers toward cheaper payment methods, though some restrictions remain.
- Interchange (swipe) fees in the U.S. reached $111.2 billion in 2024, up from $100.8 billion in 2023 and roughly four times the level recorded in 2009, per the National Retail Federation.
- The revised accord follows a June 2024 rejection by Judge Margo Brodie of an earlier $30 billion settlement; she criticized that deal’s limited savings—about $6 billion a year—as insufficient.
- Some merchant groups, including the Merchants Payments Coalition, have already signaled opposition, calling the fee cuts “minuscule” and warning that temporary caps leave long-term leverage with networks and banks.
Background
The litigation dates back about 20 years, with large and small merchants alleging that Visa, Mastercard and issuing banks conspired to keep interchange fees high and to restrict merchants’ ability to steer customers to lower-cost payment options. Merchants argued that network rules such as “Honor All Cards” and anti-steering policies forced them to accept higher-cost premium and rewards cards without practical alternatives. Card networks and banks have long defended swipe fees as necessary to pay for fraud protection, transaction processing and cardholder incentives.
In June 2024, U.S. District Judge Margo Brodie rejected a proposed $30 billion settlement that would have provided roughly $6 billion in annual merchant savings and a modest reduction of about 0.07 percentage points in fees over five years. Brodie found the savings inadequate relative to the networks’ pricing power and criticized provisions that would have preserved rules requiring merchants to accept all cards. That ruling reset negotiations and prompted the networks and merchant plaintiffs to seek a broader compromise.
Main Event
The newly announced settlement trims swipe fees by 0.1 percentage points for five years and places a 1.25% cap on standard consumer-card rates until the deal’s expiration. It also creates category-specific acceptance options: merchants can elect whether to accept U.S. commercial cards, premium consumer cards (including many popular rewards cards), and standard consumer cards. Those acceptance choices are intended to give merchants more control over which card types they process and at what effective cost.
Visa framed the package as “meaningful relief, more flexibility and options to control how they accept payments,” saying it benefits merchants “of all sizes.” Mastercard emphasized that smaller merchants will gain simpler rules, lower costs and greater flexibility, adding that consumers and businesses should see a better payments experience. Both firms said they did not admit wrongdoing by agreeing to the settlement.
Merchants will also obtain broader rights to surcharge—adding a fee when a customer pays by credit card—and to deploy steering tools that direct customers toward lower-cost payment methods. However, critics say those new options may be constrained in practice by continued categorization powers held by banks and by the continued prevalence of rewards cards, which dominate card issuance.
Analysis & Implications
For merchants, a 0.1 percentage-point reduction translates into uneven savings depending on sales mix and card usage. Large retailers with high volumes of card-not-present and rewards-card transactions may see limited near-term relief, while small businesses with more in-person, lower-ticket transactions could benefit relatively more from simplified rules and surcharge flexibility.
For cardholders and banks, the settlement preserves significant levers. Rewards programs—used on an estimated 85% of issued consumer cards—remain largely intact, and banks retain the ability to reclassify cards between categories. That flexibility means interchange revenue streams for issuers are still protected over the medium term, raising questions about the settlement’s durability as a structural remedy.
Regulators and plaintiffs’ lawyers will likely scrutinize the enforcement mechanisms and fee ceilings if the deal wins court approval. Judge Brodie’s earlier objections focused on insufficient merchant relief and rules that locked merchants into accepting all cards; the revised agreement attempts to address those concerns but leaves room for further challenge from trade groups that want firmer, long-term constraints on network pricing and bank categorization practices.
Comparison & Data
| Year | U.S. Interchange Fees |
|---|---|
| 2009 | (~one-quarter of 2024 level) |
| 2023 | $100.8 billion |
| 2024 | $111.2 billion |
The table highlights a rapid rise in interchange costs over 15 years. Merchants say such growth squeezes margins and raises consumer prices indirectly, while networks and issuers argue fees fund fraud control, payment guarantees and cardholder rewards. The relative impact on any single merchant depends on card mix (rewards vs. standard), average transaction value and whether the business can pass costs to consumers via surcharges or price adjustments.
Reactions & Quotes
Pro-settlement voices within the payments industry praised the deal as a pragmatic step. Network statements stress flexibility and lower costs for merchants while noting no admission of liability.
“The settlement provides merchants of all sizes meaningful relief, more flexibility and options to control how they accept payments from their customers.”
Visa (company statement)
Merchant groups and some independent retailers, however, view the concessions as insufficient and temporary, arguing that long-term structural fixes are needed to limit issuer leverage over categorization and pricing.
“The fee reduction is minuscule and leaves Visa and Mastercard free to raise fees after the temporary cuts expire.”
Merchants Payments Coalition (trade group)
Legal observers note that Judge Brodie’s earlier rejection set a high bar for meaningful merchant relief; her continued oversight will shape whether the revised terms survive judicial review. If approved, the settlement could still draw objections from merchant litigants who seek stronger, permanent limits on network and bank behavior.
Unconfirmed
- Precise long-term caps and reclassification limits for card categories remain unclear until the settlement text is filed and the court rules.
- It is not yet confirmed which merchant groups will formally object to the settlement at the approval hearing; several trade groups have signaled likely opposition but final filings are pending.
Bottom Line
The revised settlement offers merchants incremental cost relief and new operational options but stops short of permanently constraining interchange pricing or banks’ card-categorization power. A 0.1 percentage-point cut and a temporary 1.25% cap on standard consumer rates will provide measurable—but uneven—savings across different merchant types.
Judge Margo Brodie’s upcoming review will be decisive: she rejected an earlier $30 billion deal for delivering insufficient merchant benefit, and she may demand stronger, longer-lasting protections before approving any settlement. Even if the agreement is approved, the balance of power among networks, issuers and merchants is likely to remain contested in regulatory and commercial forums.