Earlier this month, when the Visa and MasterCard announced a massive settlement in the legal battle over credit card swipe fees, it looked like the seven-year-old dispute had finally come to an end — and that we’d all soon be seeing credit card surcharges at retailers. But in just the last few days, the nation’s largest retailers have come out in opposition of the settlement.
Yesterday, Walmart released this statement saying it was “disappointed” by the deal:
The proposed settlement would not structurally change the broken market or prohibit credit card networks from continually increasing hidden swipe fees, which already cost consumers tens of billions of dollars each year. The proposed settlement would require merchants to broadly waive their rights to take action against the credit card networks for detrimental conduct or acts. We believe the proposed settlement would also constrain emerging payments innovation. As Walmart continues to seek reform that will provide transparency and true competition among financial institutions, we encourage all merchants to put consumers first and reject the settlement.
Note that the Walmart statement does not mention anything about opposing the part of the settlement that allows credit card surcharges, which retailers have long been pining for.
However, in a statement released late last week, Target writes that it “has no interest in surcharging guests who use credit and debit cards in order to allow VISA and MasterCard to continue charging unfair fees.”
The first voices of dissent regarding this settlement came from associations representing the nation’s truck stops and convenience stores.
The heart of the lawsuit is that while Visa and MasterCard have allegedly colluded to both keep their merchant fees at similar, high levels, effectively killing competition and saddling merchants with fees they are not allowed to pass directly on to customers.