Settlement reached on legal dispute over interchange fee settlement

Customer checkout fees at the register

The US District Court for the Eastern District of New York has announced that a settlement has been reached in the long-running legal dispute between retailers, payment networks and nine major card issuers over interchange fees and rules (view press release).

As part of the settlement, retailers negotiated the ability to charge their customers a checkout fee (merchant surcharge) at the register. Historically, banning surcharging has been an important safeguard, and it remains illegal in ten states. To the extent that retailers do assess checkout fees, we are pleased that the settlement includes important safeguards that will help to curb any abusive or excess checkout fees at the register,” a statement by The Electronic Payments Coalition said. “The deliberate and measured approach of the settlement process is in stark contrast to that of the Durbin amendment, which was passed in the dark of night with no review of its consequences and virtually no public debate. These government price controls shifted USD8 billion from banks to the retailers, with no evidence that consumers are seeing lower prices as a result.”

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