U.S. District Judge Brian Cogan granted preliminary approval to a revised $38 billion settlement between Visa, Mastercard, and merchants on Tuesday, clearing a major hurdle in a nearly two-decade antitrust dispute over swipe fees.
The settlement resolves litigation that began in 2005, when merchants accused Visa, Mastercard, and banks of conspiring to violate antitrust laws through the collection of interchange fees—the charges retailers pay each time a customer swipes a credit or debit card. Cogan’s approval came nearly two years after a different judge rejected a $30 billion settlement as inadequate.
Under the agreement announced last November, Visa and Mastercard agreed to lower swipe fees by 0.1 percentage point for five years and cap standard consumer card rates at no more than 1.25% for eight years. The settlement also grants merchants the right to decline entire categories of cards—including commercial cards, premium consumer cards with rewards, and standard consumer cards—and provides more flexibility to impose surcharges on customers.
Opposition from Major Retailers
Despite preliminary approval, the settlement faces significant opposition from major retailers and trade groups including the National Retail Federation, Walmart, the Merchants Payments Coalition, and the National Association of Convenience Stores. These objectors argue that the changes are largely illusory because merchants would still be required to “honor all issuers” within a given network—meaning they cannot accept cards from one bank while rejecting another’s cards.
Walmart called the settlement a “gift” to Visa and Mastercard, saying it would let the card networks lock in anticompetitive conduct that has persisted for more than 30 years “without fear of being challenged by large national merchants.” Swipe fees totaled $118.8 billion for Visa and Mastercard in the United States in 2025, up from $111.2 billion in 2024, according to the Merchants Payments Coalition.
Supporters of the settlement, including the Electronic Payments Coalition whose members include Bank of America, Capital One, Chase, and Citibank, argue that the agreement delivers substantial relief. Two experts hired by plaintiffs—Nobel Prize-winning economist Joseph Stiglitz and University of Washington professor Keith Leffler—said the changes could save merchants $38 billion by 2031 and provide $224 billion of total benefits, including to consumers.
Preliminary approval allows the settlement to move forward, but objections and additional review may still follow before final approval is granted. When a previous $30 billion settlement was rejected in June 2024, U.S. District Judge Margo Brodie said fees would have remained above levels absent any antitrust violations and improperly maintained the “Honor All Cards” rule that required merchants to accept all Visa and Mastercard cards or none.
Sources
- Reuters — Judge Cogan’s preliminary approval of the $38 billion settlement, settlement terms, and merchant opposition (June 9, 2026)
- Reuters — Details on settlement terms and judge’s April 27 hearing on the revised agreement
- Merchants Payments Coalition — Swipe fee totals for 2024 and 2025
