"If approved by the court, the payment giants would reduce interchange fees by 0.1% over the next five years and cap standard consumer credit rates at 1.25% for eight years. It would also scrap a rule requiring merchants to accept all cards from a given network. That change could open the door for stores to reject credit card tiers-such as higher-fee, high-reward cards like the Chase Sapphire Reserve or Capital One Venture X -or further pass fees directly to consumers."
"With the new move, merchants could more easily add surcharges selectively who are less price-sensitive, John Cabell, managing director of payments intelligence at J.D. Power, told Fortune. Premium cardholders, with annual fees above $500, spend an average of $2,736 a month, nearly three times as much as those with cheaper cards. Only 22% of those cardholders report they select alternate payment methods when faced with a surcharge, according to J.D. Power data. That's compared to 33% of holders of no-fee cards."
A proposed settlement would reduce interchange fees by 0.1% over five years and cap standard consumer credit rates at 1.25% for eight years while removing a rule that requires merchants to accept all cards from a network. Merchants could selectively add surcharges or reject high-fee, high-reward card tiers, potentially passing costs to consumers. Visa and Mastercard collected $111.2 billion in credit card swipe fees in 2024, up 10% year over year and four times the 2009 level. Premium cardholders spend substantially more and are less likely to switch payment methods when surcharged, posing a trade-off for merchants.
Read at Fortune
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