NRF to block swipe fee lawsuit settlement

Visa and MasterCard credit card swipe fees

The National Retail Federation’s Board of Directors has given permission for it to go to court to block the proposed USD7.25 billion settlement of a federal antitrust lawsuit over ‘skyrocketing’ Visa and MasterCard credit card swipe fees that cost consumers hundreds of dollars a year (view press release). Swipe fees are a hidden charge banks collect each time a Visa or MasterCard is swiped to pay for a purchase. Combined credit and debit card swipe fees have reportedly tripled over the past decade to about USD50 billion a year, driving up prices an estimated USD427 for the average household, before debit swipe was capped by the Federal Reserve last year.  Credit card swipe averages about 2% of each transaction, amounting to about USD30 billion a year, or USD250 per household. Swipe fees are the second or third highest expense for most retailers, behind employee salaries and health care benefits.

The National Retail Federation categorically opposes the proposed settlement,” said NRF President and CEO Matthew Shay. “It does nothing to curb the anticompetitive behaviour of Visa and MasterCard, and instead ensures that swipe fees paid by retailers and their customers will continue to rise while barring any future legal challenges. The proposal is a lose-lose-lose for merchants, consumers and competition. NRF will take any and all steps necessary to oppose the settlement as it is currently proposed and will work toward real reform of the swipe fee system.”

Related reading

A hand holding a smartphone with $ icons on the screen, which is visually connected to a network of little people around it

Leave a comment