News Ghana: Visa and Mastercard Swipe Fees Reached Record High
“Once again, Main Street merchants and consumers were hit with a new record for swipe fees in 2023,” said Christine Pollack, vice president of government relations for The Food Industry Association. “Last year, Visa and Mastercard fixed the banks’ prices to the tune of more than $100 billion in credit card swipe fees. That is an awful toll for Main Street businesses and their customers to bear.” U.S. merchants were charged $7.5 billion more for credit cards with Visa and Mastercard logos in 2023 than they were in 2022, the Merchants Payments Coalition said. Total swipe fees, including debit cards, topped $172 billion, compared to $160 billion in 2022. And of that figure, more than $132 billion in swipe fees were from debit and credit cards with the Visa or Mastercard logos, the coalition said.
READ MORE +
Wall Street Journal: Analysis: The Visa and Mastercard Settlement Doesn’t Put Fee Disputes to Rest
Some merchants want the ability to negotiate directly with the banks—not Visa and Mastercard—in a free-market environment where the banks have to compete with one another on setting interchange rates. “This settlement is a bad deal for merchants,” said Christopher Jones, an executive committee member for Merchants Payments Coalition, an industry trade group. Jeff Brabant, head of federal government relations at the National Federation of Independent Business, said the settlement isn’t enough and the issue needs to be addressed with legislation.
READ MORE +
Modern Retail: Proposed Deal From Visa & Mastercrd Causes Concern Among Retailers
Doug Kantor, general counsel for the National Association of Convenience Stores, said one of the issues with the settlement is it doesn’t address how Visa and Mastercard set the prices for swipe fees that are uniform across banks. This means businesses can’t price-shop the way they might for other vendors or expenses. “Merchants can’t differentiate and say, ‘Citibank, you’re too expensive, I want Wells Fargo or these other guys,'” he said. “They can only say ‘I’m going to take Visa and Mastercards or I’m not.” Kantor is an executive committee member of the Merchant Payments Coalition, which supports seeing legislation to help control swipe fees. He said some members of the coalition are already considering what they may have to do to challenge the settlement.
READ MORE +
Bloomberg Law: Visa, Mastercard Swipe Fee Deal Fails to Stem More Litigation
The proposed settlement is weak for merchants, given that it’s expected to save them $30 billion over five years, while US businesses paid more than $170 billion in swipe fees last year alone, said Doug Kantor, member of the executive committee of the Merchants Payments Coalition. The coalition is a Washington, D.C.,-based group of retailers advocating for competition in the payments market. Visa and Mastercard will continue to set prices for swipe fees charged to merchants each time a customer makes a purchase, and there’s nothing standing in the way of the companies raising them again after five years, Kantor said. “It’s very small and very temporary relief and then back to business as usual,” Kantor said. “The plaintiffs want a market that actually works and puts normal competitive pressure on fees.”
READ MORE +
NerdWallet: How the Visa-Mastercard Swipe Fee Settlement Affects Cardholders
The Merchant Payments Coalition, a CCCA proponent, counters that a temporary fee reduction leaves consumers and businesses hanging once the five-year period is over. “A few years of very small relief followed by business as usual is not a good outcome from 20 years of litigation,” said a statement from Christopher Jones, a member of the merchant coalition's executive committee and the National Grocers Association's senior vice president of government relations and counsel. “The settlement does nothing to actually bring competitive market forces to swipe fees or change the behavior of a cartel that centrally fixes rates and bars competition. Instead, it tries to provide token, temporary relief and then allows the card companies to raise rates yet again.”
READ MORE +
NACS Daily: Swipe Fee Settlement a Bad Deal
“Unfortunately, this settlement does not look much better than the one we successfully fought in 2012,” said NACS General Counsel Doug Kantor. “There are some additional provisions, but our initial review shows them to be limited in time and efficacy. We expect most merchant groups will see this the same way and that there will be major efforts to urge the court to reject the settlement.” Other retail-focused associations shared Kantor’s message. “This settlement is a bad deal for merchants,” said National Grocers Association Senior Vice President of Government Relations and Counsel Christopher Jones. “A few years of very small relief followed by business as usual is not a good outcome from 20 years of litigation. The settlement does nothing to actually bring competitive market forces to swipe fees or change the behavior of a cartel that centrally fixes rates and bars competition. Instead, it tries to provide token, temporary relief and then allows the card companies to raise rates yet again. Congress needs to act so that we will have real reform that will benefit merchants and their customers.” Jones and Kantor both serve as executive committee members of the Merchants Payments Coalition, a group founded 20 years ago that represents retailers, supermarkets, convenience stores, gasoline stations, online merchants and others fighting for a more competitive and transparent card system that is fair to consumers and merchants.
READ MORE +
Digital Transactions: Buying Groups Might—or Might Not—Give Merchants More Negotiating Power with the Card Networks
The Merchants Payments Coalition, a group representing retailers, supermarkets, convenience stores, gas stations, online merchants, and others in card-related matters, issued a statement saying the proposed settlement would provide “very small relief” and “does not end the need for Congress to pass legislation.”
READ MORE +
Supermarket News: Visa, Mastercard agree to $30 billion settlement over credit and debit card swipe fees
The settlement “would provide very small relief and does not end the need for Congress to pass legislation,” the Merchants Payments Coalition (MPC) said in a statement following the announced agreement. “This settlement is a bad deal for merchants,” MPC Executive Committee member and National Grocers Association Senior Vice President of Government Relations and Counsel Christopher Jones said. “A few years of very small relief followed by business as usual is not a good outcome from 20 years of litigation. The settlement does nothing to actually bring competitive market forces to swipe fees or change the behavior of a cartel that centrally fixes rates and bars competition. Instead, it tries to provide token, temporary relief and then allows the card companies to raise rates yet again. Congress needs to act so that we will have real reform that will benefit merchants and their customers.”
READ MORE +
Wall Street Journal: Credit-Card Settlement Could Make Things Interesting at the Checkout Counter
Still, some retailers may keep battling for more changes. A statement by the Merchants Payments Coalition, an industry group, said the settlement provides “‘very small relief’ and does not end the need for Congress to pass legislation.”
READ MORE +
Politico Influence: Big Swipe Fee News
“This settlement is a bad deal for merchants,” argued Christopher Jones, a lobbyist for the National Grocers Association and a leader at the Merchants Payments Coalition. In a statement, Jones maintained that the settlement would provide “a few years of very small relief followed by business as usual,” arguing that “Congress needs to act so that we will have real reform that will benefit merchants and their customers.”
READ MORE +