U.S. Court of Appeals Upholds Swipe Fee Settlement


The United States Court of Appeals for the Second Circuit upheld the $5.6 billion swipe fee settlement deal as part of the long-running class-action lawsuit regarding interchange fees charged by Visa and Mastercard. 

Plaintiffs of the In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, including NATSO, argued that credit card processors violated antitrust laws by fixing interchange fees at excessive levels. Litigation began in 2005, and the Court of Appeals gave preliminary approval to the multibillion-dollar settlement on Feb. 22, 2019. 

At this time, it is unclear if any party will pursue further appeals.

Following the March 21, 2023, decision to uphold the settlement, a lower court now will appoint a special master to determine which plaintiffs and retailers will be eligible for funds. The value of each claim will be based on the actual or estimated interchange fees attributable to the merchant's Mastercard and Visa. 

NATSO members seeking more information, including a link to the full opinion, should utilize the official court authorized website: https://www.paymentcardsettlement.com/en. The court will update this site as new details become available.

NATSO will continue to update its members as new information becomes available. 

For years, credit card companies have charged interchange fees, or swipe fees, to merchants and retailers, amounting to as much as 4 percent of the customer’s purchase. Merchants paid $126.4 billion in processing fees for credit cards in 2022, an increase of 20 percent, according to the Merchants Payments Coalition, of which NATSO is a member. Swipe fees are most retailers’’ highest operating cost after labor.

NATSO had previously objected to the settlement offer because it ultimately failed to address the problems that merchants and their customers have with swipe fees. Merchants pay tens of billions of dollars in fees to credit card companies, and the settlement offer would not have provided any reform to the credit card payment system. 

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