$38 Billion Visa & Mastercard Swipe Fee Settlement
A federal judge has granted preliminary approval to a massive $38 billion settlement between Visa, Mastercard and millions of U.S. merchants. The lawsuit has been going on for over two decades now.
The lawsuit alleged that the card networks charged excessively high “swipe fees” (also known as interchange fees) every time a customer pays with a credit card.
Under the proposed settlement, Visa and Mastercard would reduce swipe fees by 0.1 percentage point for five years and cap standard consumer card rates at 1.25% for eight years. Merchants would also gain more flexibility in deciding which types of cards they accept and could have additional options for surcharging customers.
The case affects more than 12 million merchants and comes as swipe fees continue to climb. According to merchant groups, Visa and Mastercard collected nearly $119 billion in swipe fees during 2025, with the average fee reaching 2.36% of each transaction.
For points and miles enthusiasts, the biggest question is whether the settlement could eventually impact premium rewards cards. Cards such as the Chase Sapphire Reserve, Amex Platinum, Capital One Venture X and other high-end products usually carry higher interchange fees, which help fund generous rewards, lounge access, travel credits and other perks.
The settlement would no longer require merchants to accept the “Honor All Cards” rule. So they will be able to selectively accept payment cards based on type (commercial, premium consumer, and standard consumer cards), instead of having to accept every card in a network or none at all.
That said, it would be confusing if large merchants especially start accepting some Mastercard and Visa cards and not others. Also the impact would likely take years to reach customers. The settlement still requires final approval, and several merchant groups continue to argue that the agreement does not go far enough.
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