Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Visa, Mastercard can likely handle swipe-fee settlement bigger than $30 billion: judge By: FOX Business June 30, 2024 at 18:57 PM EDT A judge who rejected a proposed $30 billion settlement between card issuers Visa and Mastercard and merchants said the issuers could likely handle a "substantially greater" settlement. A federal judge said Friday that card issuers Visa and Mastercard could likely withstand a "substantially greater" settlement with merchants who argued they overpaid swipe fees than the proposed $30 billion settlement she rejected last week.U.S. District Judge Margo Brodie of the Eastern District of New York provided that assessment in an 88-page opinion she released Friday, just three days after she rejected the preliminary $30 billion settlement.The agreement would have lowered and capped swipe fees, also known as interchange fees, that are paid by over 12 million merchants to handle Visa and Mastercard transactions.The judge called the estimated $6 billion in annual savings for merchants a "paltry" amount compared to the estimated $100 billion in fees they paid to Visa and Mastercard in 2023.JUDGE REJECTS MULTIBILLION VISA, MASTERCARD SETTLEMENT IN SWIPE FEE CASE"Without evidence of Visa's and Mastercard's profitability, the court cannot say with certainty that defendants can withstand a greater judgment; however, the evidence strongly suggests that they could withstand a substantially greater judgment," Brodie wrote.The long-running antitrust litigation around swipe fees began in 2005 and could go to trial if the card issuers and merchants aren't able to agree on a new settlement that passes the judge's review.EBAY DITCHING AMERICAN EXPRESS AS PAYMENT OPTION THIS SUMMER"While we are disappointed with the judge's decision, we continue to believe that direct resolution with merchants is the best way forward and are evaluating all options as the case proceeds," Visa told FOX Business in a statement. "The U.S. payments ecosystem is the most advanced in the world, and our focus is on maintaining the security, innovation, rewards and access to credit that are critical to American consumers and small businesses that power our economy," Visa added.Mastercard did not immediately respond to a request for comment.WALMART, CAPITAL ONE END EXCLUSIVE CREDIT CARD AGREEMENTIn the wake of the ruling, Mastercard previously expressed disappointment and said the settlement would've encouraged competition and given millions of businesses "substantial certainty and enormous value in how they manage their card acceptance activities."Under the terms of the settlement rejected by the judge, card issuers would've lowered the typical 1.5% to 3.5% swipe fee by 0.04 percentage points for three years, capped fees for five years and given merchants more room to impose surcharges.Brodie said the proposed changes fell short of the "best possible" recovery because it kept fees significantly above where they would be without the alleged antitrust violations and still "saddled" merchants with the "Honor All Cards" rule, which requires them to accept all Visa and Mastercard cards or none.GET FOX BUSINESS ON THE GO BY CLICKING HEREMany merchants objected to the settlement, as did some trade groups, including the National Retail Federation.Reuters contributed to this report. Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Visa, Mastercard can likely handle swipe-fee settlement bigger than $30 billion: judge By: FOX Business June 30, 2024 at 18:57 PM EDT A judge who rejected a proposed $30 billion settlement between card issuers Visa and Mastercard and merchants said the issuers could likely handle a "substantially greater" settlement. A federal judge said Friday that card issuers Visa and Mastercard could likely withstand a "substantially greater" settlement with merchants who argued they overpaid swipe fees than the proposed $30 billion settlement she rejected last week.U.S. District Judge Margo Brodie of the Eastern District of New York provided that assessment in an 88-page opinion she released Friday, just three days after she rejected the preliminary $30 billion settlement.The agreement would have lowered and capped swipe fees, also known as interchange fees, that are paid by over 12 million merchants to handle Visa and Mastercard transactions.The judge called the estimated $6 billion in annual savings for merchants a "paltry" amount compared to the estimated $100 billion in fees they paid to Visa and Mastercard in 2023.JUDGE REJECTS MULTIBILLION VISA, MASTERCARD SETTLEMENT IN SWIPE FEE CASE"Without evidence of Visa's and Mastercard's profitability, the court cannot say with certainty that defendants can withstand a greater judgment; however, the evidence strongly suggests that they could withstand a substantially greater judgment," Brodie wrote.The long-running antitrust litigation around swipe fees began in 2005 and could go to trial if the card issuers and merchants aren't able to agree on a new settlement that passes the judge's review.EBAY DITCHING AMERICAN EXPRESS AS PAYMENT OPTION THIS SUMMER"While we are disappointed with the judge's decision, we continue to believe that direct resolution with merchants is the best way forward and are evaluating all options as the case proceeds," Visa told FOX Business in a statement. "The U.S. payments ecosystem is the most advanced in the world, and our focus is on maintaining the security, innovation, rewards and access to credit that are critical to American consumers and small businesses that power our economy," Visa added.Mastercard did not immediately respond to a request for comment.WALMART, CAPITAL ONE END EXCLUSIVE CREDIT CARD AGREEMENTIn the wake of the ruling, Mastercard previously expressed disappointment and said the settlement would've encouraged competition and given millions of businesses "substantial certainty and enormous value in how they manage their card acceptance activities."Under the terms of the settlement rejected by the judge, card issuers would've lowered the typical 1.5% to 3.5% swipe fee by 0.04 percentage points for three years, capped fees for five years and given merchants more room to impose surcharges.Brodie said the proposed changes fell short of the "best possible" recovery because it kept fees significantly above where they would be without the alleged antitrust violations and still "saddled" merchants with the "Honor All Cards" rule, which requires them to accept all Visa and Mastercard cards or none.GET FOX BUSINESS ON THE GO BY CLICKING HEREMany merchants objected to the settlement, as did some trade groups, including the National Retail Federation.Reuters contributed to this report.