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Visa and Mastercard on Tuesday agreed to cut their US transaction fees in a landmark settlement that merchants say will save them $30bn over five years.
The deal, announced on Tuesday, will require the payments companies to lower the so-called swipe fees they charge sellers over the next five years.
It will also allow merchants to charge different prices to consumers based on which credit card they use.
The agreement concludes a long-running case brought by merchants that alleged the credit card companies inflated payment processing fees.
Merchants are currently able to charge an extra fee for consumers who use American Express cards, but Visa and Mastercard have blocked sellers from doing so for their users.
The settlement does not include a requirement for merchants to pass on the savings from lower fees to consumers.
“By negotiating directly with merchants, we have reached a settlement with meaningful concessions that address true pain points small businesses have identified,” said Kim Lawrence, president of Visa North America.
Rob Beard, chief legal officer, general counsel and head of global policy at Mastercard, said: “This agreement brings closure to a long-standing dispute by delivering substantial certainty and value to business owners, including flexibility in how they manage acceptance of card programmes.”
This is a developing story
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