Retailers scored a big win versus credit card companies yesterday, settling a seven-year-long lawsuit for $6 billion, plus fees relief that could reach $1.2 billion, reports the Wall Street Journal. Visa, MasterCard, and several large banks agreed to the deal, which will give merchants the option of charging customers more who want to use plastic instead of cash. "Meaning you may soon be paying more for the privilege of using your credit card," notes the Consumerist. Visa will pay 67% of the $6 billion settlement, with MasterCard splitting the remainder with the card-issuing banks, including JPMorgan Chase, Bank of America, and Wells Fargo.
The lawsuit was first filed in 2005 by several large retailers, including Kroger, Safeway, and Walgreen, alleging price-fixing by Visa and MasterCard for their prohibitions against charging customers more for using credit cards. Other merchants also filed suits, and eventually more than 50 cases were combined into one. Ten states have laws forbidding credit card surcharges, and merchants in those states won't be able to assess the extra fee. New York is one, although the issue is currently before a US district court, reports the Consumerist. (Read more Visa stories.)