interchange

The agreement comes after a two-decade antitrust battle over interchange fees, the charges banks collect from merchants every time a customer pays with plastic.

Some small merchants have been steering customers to pay with apps to avoid interchange fees, or giving discounts to customers who don’t pay with cards.

At the heart of the matter are credit-card interchange fees, which merchants pony up when shoppers pay with plastic.

The settlement would also lower the networks’ combined average effective credit interchange rates in the U.S. by 10 basis points for five years, whereas the prior attempt at a settlement allowed for a 7-basis-point reduction.

In March 2024, the two sides reached a deal to lower interchange fees by around 0.07 percentage point on average over five years.