WASHINGTON — Nearly 1,000 businesses and trade associations are urging a federal judge to reject a proposed settlement in the long-running antitrust litigation over Visa and Mastercard credit card swipe fees, arguing the agreement would provide merchants with little meaningful relief while broadly shielding the card networks and issuing banks from future liability, according to the Merchants Payments Coalition.
The coalition said 978 businesses and associations signed an objection filed Thursday with U.S. District Judge Brian Cogan, who is considering whether to grant final approval to the settlement after giving it preliminary approval in June.
Signers include small, medium and large retailers, restaurants, supermarkets, convenience stores, gas stations and trade associations from all 50 states, the District of Columbia and Puerto Rico, MPC said.
The merchants said they had no role in negotiating the agreement, which was reached between Visa, Mastercard and attorneys representing the merchant class.
They contend the settlement would preserve the existing system governing credit card interchange fees and network rules while providing only temporary relief.
‘Anti-Competitive Business Model’
“This is the third attempt by the credit card industry to push a settlement in this litigation that protects and preserves their anticompetitive business model for years to come,” the merchants said in their objection.
MPC Executive Committee member Doug Kantor said the number and range of businesses joining the objection demonstrates broad merchant opposition to the proposal.
Litigation Dates to 2005
As the CU Daily reported earlier, the proposed agreement stems from antitrust litigation dating to 2005 challenging Visa and Mastercard rules and the interchange fees paid by merchants accepting their cards.
Merchants have alleged the networks and card-issuing banks violated federal antitrust law through the system used to establish interchange fees and rules governing card acceptance.
An earlier settlement was overturned by the 2nd U.S. Circuit Court of Appeals in 2016.
Another proposed settlement was rejected in 2024 by U.S. District Judge Margo Brodie. Among the issues raised by the court were the structure for setting interchange fees and Visa and Mastercard rules governing which cards merchants must accept.
The current agreement, released in November 2025, represents a third attempt to settle the litigation.
MPC said that although the latest proposal differs somewhat from the 2024 agreement, merchants contend the changes remain inadequate.
Merchants Criticize Fee Reduction
Among the merchants’ primary objections is the size and duration of the proposed interchange-fee reduction.
The agreement would reduce interchange rates by one-tenth of a percentage point for five years, according to MPC.
The coalition said that compares with an average Visa and Mastercard credit card swipe-fee rate of 2.36% in 2025 and would effectively return the average rate only to approximately its 2023 level.
MPC said the reduction also applies only to interchange fees paid to card-issuing financial institutions, while separate network fees collected by Visa and Mastercard could continue increasing.
‘80% Increase’ Cited
The coalition said Visa and Mastercard credit card swipe fees averaged 2.36% in 2025, while combined credit and debit card swipe fees reached a record $198.25 billion, up 80% since the pandemic. Those figures are based on data cited by MPC from the Nilson Report.
The merchants also object to the scope and duration of the settlement’s release of legal claims.
According to MPC, merchants are concerned the agreement could restrict future lawsuits involving not only issues raised in the existing litigation but claims that could have been raised and potentially disputes involving future fees or conduct.
Merchants Question Card-Acceptance Changes
The proposed settlement also would modify Visa and Mastercard’s “honor all cards” requirements by giving merchants greater ability to decline premium credit cards carrying higher interchange rates while continuing to accept lower-cost standard cards.
The merchants said the provision would have little practical value because more than 90% of credit card spending takes place on rewards cards.
Rejecting premium cards, they argued, could therefore mean refusing a large share of the cards customers want to use.
The settlement also would cap interchange rates for standard credit cards at 1.25%, but MPC said those cards represent a small and declining portion of the market.
The merchants said the agreement does not prevent card issuers from shifting cards into premium categories or potentially developing another category not subject to the cap.
Surcharge Provision Also Criticized
Another provision would allow merchants to impose surcharges of up to 3% on credit card transactions.
The businesses opposing the agreement said surcharging is often impractical because of differing state laws, card-network requirements and concerns that consumers will blame merchants for the added charge.
They also said Visa and Mastercard would retain the ability to establish higher fees for merchants that impose surcharges, potentially reducing the value of the provision.
MPC argues that rising swipe fees are difficult for merchants to absorb and are ultimately reflected in consumer prices. The coalition estimates the fees increase costs for an average U.S. family by more than $1,200 annually.
Congressional Debate Continues
The court dispute comes as Congress continues considering the Credit Card Competition Act, which is strongly opposed by credit unions and banks and just as strongly favored by the merchants group.
Under the proposal, banks with at least $100 billion in assets would be required to enable credit cards they issue to be processed over at least two unaffiliated networks, such as Visa or Mastercard and a competing network such as NYCE, Star or Shazam.
Supporters contend that providing merchants with alternative routing options would create competition over processing fees, security and service.
‘$17 Billion in Savings’
MPC cites an estimate that the legislation could save merchants and consumers $17 billion annually. The estimate is an advocacy-backed projection rather than savings that have been demonstrated because the legislation has not been enacted.
The Merchants Payments Coalition represents retailers, supermarkets, restaurants, convenience stores, gas stations, online merchants and other businesses advocating changes to the U.S. card-payment system.
