A federal court judge has given preliminary approval to a $38 billion settlement that would end a decades-long lawsuit over the interchange fees charged by credit card companies Visa and Mastercard.
But restaurants, and other merchants for that matter, do not seem impressed. “This settlement does little to address the problem of the anti-trust lawsuit that got us here and doesn’t provide true relief to the small business restaurant owners who are struggling to manage swipe fees that have gone up more than 80% since the pandemic,” Sean Kennedy, chief advocacy officer for the National Restaurant Association, said in a statement.
The Electronic Payments Coalition, or EPC, a group of payment networks, banks and credit unions, said that the agreement could result in more than $200 billion in relief over eight years. “This small business credit card agreement delivers nearly a quarter trillion dollars in relief,” Richard Hunt, executive chairman of the coalition, said in a statement. “It is a guaranteed win for Main Street and provides meaningful solutions for businesses and consumers.”
The settlement, initially announced last year, is technically the third settlement in a case that was initially filed in 2005. That means the dispute predates the Great Recession, the pandemic and the invention of the iPhone.
Groups representing a wide range of retailers, including restaurants, have alleged that the processing companies have a monopoly on credit card transaction processing, enabling them to charge high fees.
Under the settlement agreement, the interchange fees the processing companies charge would be lowered by an average of 0.1 percentage points over a five-year period. Yet those swipe fees average 1.4% to 3.25%. Those fees averaged 2.36% in 2025, according to the National Restaurant Association.
Restaurants have long argued that these fees have grown too cumbersome, particularly for an industry that relies on thin margins and low profits. Average profitability in the restaurant industry has declined since 2019 and 42% of restaurant companies say they are not profitable.
Swipe fees, according to the National Restaurant Association, have become the third-largest cost for restaurants.
The settlement, however, does nothing to change the “price fixing” by major credit card companies, which the industry says violates antitrust rules. A 2016 settlement of the lawsuit was overturned after merchants said that the deal didn’t go far enough.
A second settlement reached in 2024 was also overturned after a judge said that the payment companies’ “honor all cards” rule required merchants to accept all cards from all banks regardless of the fees charged.
“It’s difficult to see how this settlement is fair compensation for restaurant owners or consumers, especially following a year when nearly half of restaurant owners didn’t make a profit because of skyrocketing costs,” said Kennedy, who said that the association would continue to raise objections while pushing for reform at the Congressional level.
The association was not the only merchant group that was displeased with the settlement approval.
“Retailers continue to face excessive and ever-increasing swipe fees in a broken payments market that lacks competition,” the Retail Industry Leaders Association, or RILA, said in a statement.
“The proposed settlement offers no meaningful relief and leaves intact the underlying system that enables Visa and Mastercard to dictate the rules and costs that merchants and consumers must bear,” the National Retail Federation said.
The EPC, however, placed the blame with large-scale retailers, notably Walmart, which helped lead objections to the 2024 settlement. “Unfortunately, corporate mega-stores, their lobbyists, and their lawyers want to block this agreement to push untested, unworkable mandates that only further pad their profits,” Hunt said.
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