As reported by Reuters and other news sources around the world, Mastercard, Visa, and various banks just signed off on billions of dollars in payments to retailers due to the credit card companies’ trade practices.
There is no doubt that the credit card companies are the big losers and that retailers are the big winners. But the big question is: Will shoppers using credit cards now be required to pay more than those paying in cash?
In the Reuters story, Jessica Dye writes that: “Visa Inc., MasterCard Inc., and banks that issue their credit cards have agreed to a $7.25 billion settlement with U.S. retailers in a lawsuit over the fixing of credit and debit card fees in what could be the largest antitrust settlement in U.S. history. The settlement, if approved by a judge, would resolve dozens of lawsuits filed by retailers in 2005. The card companies and banks would also allow stores to start charging customers extra for using certain credit cards in an effort to steer them toward cheaper forms of payment. Merchants would also be required to disclose information about card fees to customers, and credit card surcharges would be subject to a cap, according to the settlement papers. Surcharge rules would not affect the 10 states that currently prohibit that practice, which include California, New York, and Texas.”