What the $38 billion Visa, Mastercard swipe fee settlement means for credit card users

Personal Finance / Banking Some offers on this page are from advertisers who pay us, which may affect which products we write about, but not our recommendations. See our Advertiser Disclosure . What the $38 billion Visa, Mastercard swipe fee settlement means for credit card users Hal Bundrick, CFP® · Senior Writer Wed, June 10, 2026 at 6:40 PM GMT+2 2 min read A $38 billion Visa and Mastercard settlement with merchants accusing the credit card networks of charging excessive processing fees has been approved by a U.

S. district judge. While the decision does not grant final approval, it is another step in a legal battle that has lasted for more than 20 years.

A previous $30 billion settlement of the case was rejected two years ago in a different court. The dispute centers on "swipe fees," the charges merchants pay when customers use a credit card. A class-action suit filed by more than 12 million merchants in 2005 accused Visa and Mastercard of charging excessive processing fees.

In 2025, the credit card network charged merchants almost $119 billion in swipe fees. Many merchants, particularly small businesses, either absorb the cost or pass the processing fees of 3% to 4% on to customers as surcharges, or offer similar discounts for cash payments. If granted final approval, what will the settlement mean for consumers?

Read more: Best credit cards with no annual fee Lower merchant fees Under the proposed settlement, Visa and Mastercard have agreed to lower swipe fees (also known as interchange fees) by 0. 1 percentage point for five years. The standard consumer card fee would be capped at 1.

25% for eight years. In 2024, merchants paid an average of 2. 35% in processing fees.

Whether any savings would be passed along to consumers remains uncertain. Some rewards and premium cards may not be accepted One of the most significant results of the settlement, if approved, could be a negative impact on popular rewards cards. The "honor all cards" provision, which requires merchants to accept all Visa and Mastercard versions, would be discontinued.

Merchants may choose to decline to accept higher-cost rewards cards and other premium consumer and commercial credit cards. However, major retailers have said that such cards are too popular with customers to reject. Read more: Best rewards credit cards Merchants may impose more fees Another provision of the settlement allows merchants to pass additional processing fees on to customers as surcharges on certain higher-fee cards, or offer discounts on lower swipe-fee cards.

Yahoo Personal Finance Some retailers remain opposed The two-decade legal battle is far from resolved. The National Retail Federation said it is "disappointed" by the judge's preliminary approval of the settlement. "The proposed settlement offers no meaningful relief and leaves intact the underlying system that enables Visa and Mastercard to dictate the rules and costs that merchants and consumers must bear," the NRF said in a statement.

The organization added that it looked forward to "participating in the next phase of the proceedings. " Read More How do credit card processing fees work? When you swipe or tap your credit card, the merchant incurs certain fees.

How do these credit card processing fees work? Here's what to know. How do credit card companies make money?

Interest is only one factor. Interest is a major source of revenue for credit card companies. These are the other factors you should know to start saving more money as a cardholder.

What credit cardholders should know for 2026: Predictions, interest rates, changing benefits, and more From rewards and benefits to fees and interest rates, these are a few changes to look out for as a credit cardholder in 2026. What happens if you use a debit card as credit? It’s possible to run your debit card as “credit” at the register, which has its pros and cons.

Here’s what happens when you select credit for a debit card purchase. Why you might one day use stablecoins in place of credit cards or bank accounts Stablecoin is a form of crypto, meaning it's digital currency that runs on a blockchain network. But it’s a bit different from many mainstream cryptocurrencies and could soon become part of everyday transactions.

Credit card debt statistics (2026): See the trends Credit card debt hit $1. 28 trillion in 2025. Learn about the latest credit card statistics and industry trends.