Credit Card Companies Settle Swipe Fee Suit For $6B

Credit card companies Visa and MasterCard along with major banks have agreed to pay several billion dollars to settle a lawsuit brought by retailers. The deal is one of the largest anti-trust settlements in history. The retailers claimed that Visa, MasterCard and the banks conspired to fix the fees that stores pay to accept credit and debit cards. NPR's Wendy Kaufman reports.

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The settlement also requires Visa and MasterCard to change policies on 'swipe fees' that merchants must pay when accepting credit cards.Visa Inc.andMasterCard Inc.agreed late Friday to pay retailers $6 billion to settle a price-fixing lawsuit that alleged they overcharged companies billions of dollars in credit-card transaction fees.

A federal consumer watchdog says some credit and debit card payment companies are breaking rules it created to protect retailers, which in turn could be costing Canadians more money. The Financial Consumer Agency of Canada issued a warning to the industry on Wednesday that it will not tolerate payment companies who mislead merchants into paying hidden fees or lock them into confusing contracts.

Research Recap submits: Visa (V) and Mastercard

(Reuters)

A proposed rule that caps debit card interchange fees has banks fighting mad and retailers hesitantly rejoicing.

The credit card industry has come a long way in just a few tumultuous years.  Not long ago, the industry was pursuing cardholders so aggressively that credit was being extended to minors, deceased relatives, and in some verified cases even the family PET was receiving his own charge card!