Over the last decade and a half a series of class action lawsuits have been filed against Visa and Mastercard alleging various anticompetitive actions. At least two of these – the International Fee case and the Debit Case (Visa Check/MasterMoney settlement) have been settled. Others remain, including a case claiming that the interchange fee charged by the networks violates antitrust law.
Visa/MasterCard Antitrust Settlement
In 2003, VISA and MasterCard agreed to pay $3 billion to merchants who accepted their cards from October 1992 through June 2003 in settlement of a lawsuit filed by Wal-Mart and other retailers. The lawsuit accused the credit card networks of forcing merchants who accepted their credit cards to also accept their debit cards and overcharging for processing fees during that period. This case is currently closed and the final payment will be made to merchants later this year.
Visa MasterCard Interchange Fee Case
In 2005, a group of merchants filed a lawsuit against MasterCard, Visa and their member banks, alleging that the interchange fees set by the companies violated antitrust laws. An interchange fee is paid by merchants for each retail transaction that uses a credit or debit card. The case charges that Visa and MasterCard, which have previously been found to have monopolistic ‘market power’ in the relevant markets, set the interchange fees at non-competitive levels which are substantially higher than they need to be or are charged in other countries.
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