Visa and MasterCard have announced that they, and several major US issuers, have reached a $7.25 billion class-action settlement with US merchants. Visa's statement is here; MasterCard's statement is here. Specific terms of the agreement include:
- Distribution to class merchants of an amount equal to 10 basis points of default interchange across all credit rate categories for a period of eight consecutive months, which otherwise would have been paid to issuers and which effectively reduces credit interchange for that period of time.
- Modifications to card company rules to permit retailers to impose a surcharge on credit transactions subject to a cap and a level playing field with other general purpose card competitors. The rule changes on surcharging likely would be implemented in early 2013.
- Agreement that card companies will meet with merchant buying groups that seek to negotiate interchange rates collectively (e.g., independent drug stores).
The card-issuing banks participating in the settlement include JPMorgan Chase, Bank of America, Citibank, Wells Fargo, Capital One among others.
National Association of Convenience Stores (NACS), one of the class plaintiffs in the lawsuit, announced that they have rejected the proposed settlement.