Merchants Argue Settlement Falls Short on Fee Relief
Nearly 1,000 US retailers and trade groups have urged a federal judge to reject a proposed settlement ending a two-decade antitrust battle over Visa and Mastercard swipe fees. The motion, filed in Brooklyn federal court, argues the deal fails to address core concerns about interchange pricing and merchant choice.
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Will Judge Approve Deal Despite Widespread Merchant Opposition?
Attorneys representing the merchants contend that the deal does not go far enough in lowering transaction costs, which average around 1.8% per card purchase. They argue that even modest reductions could save small businesses hundreds of dollars monthly, but the settlement caps savings at a fraction of that potential. Furthermore, the agreement allows Visa and Mastercard to revert fee structures after just three years, leaving merchants vulnerable to future increases.
Legal experts note that this pushback reflects broader frustration among small and mid-sized retailers who feel overshadowed by large corporate chains during negotiations. „This settlement lets the biggest players off the hook while small businesses keep paying inflated fees,” said one attorney involved in the case. The merchants’ filing also highlights concerns over transparency, demanding clearer disclosure of how interchange rates are set.
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The outcome now hinges on whether Judge Margo Brodie of the Eastern District of New York will side with the merchants or approve the settlement as fair and reasonable. Legal analysts say the court may face pressure from both sides—consumer advocates supporting the deal for bringing some relief, and merchant coalitions opposing it for being insufficient.
If rejected, the case could return to trial, prolonging uncertainty for payment processors and retailers alike. A ruling is expected by early next year.
