Visa, Mastercard, and a group of US-based banks have settled a “swipe fees” dispute for $6.2bn.
Regarding a long-running argument over card swipe fees charged to US retailers and other merchants, further payment has been agreed.
The two payment groups, as well as banks including Citi and JPMorgan Chase, agreed to pay an extra $900m to the merchants. The group already paid $5.3bn in a 2012 settlement.
Splitting the bill
Visa’s share of the bonus payout is $600m, which Mastercard will hand out another $108m. Both companies has increased reserves to reflect their expected liabilities for the latest settlement.
Overall, Visa owes approximately $4.1bn of the total settlement. Furthermore, Mastercard is responsible for around 12% of the deal.
Litigation for this dispute has been around since 2005. A $7.25bn settlement was reached in 2012, but it was rejected by the court. The value of the settlement reduced after a number of merchants opted out.
“After years of thoughtful negotiation, we are pleased to be able to reach this agreement and move forward in our partnership with merchants to provide consumers convenient, reliable, secure ways to pay,” said Kelly Mahon Tullier, executive vice president, general counsel, Visa. “This outcome benefits all parties and enables us to focus more of our resources and attention to building the future of digital commerce together.”