NEW YORK, N.Y. – Visa, MasterCard and major banks agreed Friday to pay at least $6 billion to settle a lawsuit brought by retailers. A banking industry trade group said the settlement would allow stores to charge customers more to pay with a credit card.
Lawyers involved in the case called it the largest antitrust settlement in history.
The dispute dates to 2005. The retailers claimed Visa, MasterCard and the banks conspired to fix the fees that stores pay to accept credit and debit cards. The fees average about 2 per cent of the price of a purchase.
Visa and MasterCard do not lend to the people who use the cards that bear their logos. They make money on these fees, called “interchange” in the industry. They are set by card processing networks but collected by, and split with, the banks that issue the cards.
Most major U.S. banks were defendants. The merchants include grocery chains Kroger and Safeway and the Rite Aid drugstore chain.
Canada’s Competition Bureau has also taken aim at the fees charged by MasterCard and Visa.
The issue was referred to the tribunal by the bureau after a group representing independent firms complained they suspected credit card companies engaged in price fixing.
Visa and MasterCard stock both jumped in after-hours trading. Visa climbed 2.8 per cent, and MasterCard rose 3.7 per cent.