If you have made a transaction using Visa or Mastercard starting from the New Year’s day, 1st January 2004 up to 25th January 2019, you could be eligible to receive a payment. And we are not talking about a couple of pennies here; we are talking about a sum of 5.6 billion dollars. So, what’s the catch? If you are still here and did not get a form through the mail, do not panic yet. You are not out, and I will explain all of this to you.
What’s the Buzz About?
In recent years, both Visa and Mastercard have been thrown one for the other after an antitrust lawsuit which alleged that the two were charging businesses very high swipe fees. Those hidden fees that you pay when you use your credit card to purchase your regular cup of coffee or that pair of shoes you did not really need to buy. Well, guess what? Those fees have proven to be a sore point for many merchants out there. The lawsuit claimed that Visa and Mastercard, and some banks, were throwing a secret party to raise those fees, it was difficult for businesses, and they were being kept from informing customers of cheaper ways to pay.
Now, they’re offering $5.6 billion to level the playing field. And guess what? This settlement covers anyone who processed Visa or Mastercard payments at any point between those dates. Therefore, no matter whether you are the owner of a busy coffee shop, a small owner-based store, or the store may have been shut down or transferred, you may be a part!
Why Are We Here?
To make sense of this, let us go back in history a little bit. Interchange fees or swipe fees are the amount of money business entities pay for accepting card transactions. These fees generally lie around $2 for each transaction. Nonetheless, the premium rewards cards can attract fees as much as 4%. Sellers said that Visa and Mastercard not only levied these astronomically high interchange fees but also discouraged businesses from steering customers to affordable payment options.
Sometimes it feels like being at a restaurant where they allow you to order a single meal and the meal you are allowed to order is the most expensive one in the restaurant while denying you the cheaper version of the same meal. Not good, right? That is why these businesses joined hands together and exclaimed, “We have had enough of it.”
A Fair Settlement
For their part, both Visa and Mastercard denied any wrongdoing. But they went ahead and settled, also promising to pay $5.6 billion and start making some of the changes. These changes range from cutting swipe fees to at least 0. 4% for at least 3 years and maintain those fees at least until year 2028. They are also agreeing that merchants will be allowed to guide customers to other options of cheaper cards. Who would have thought that a little rivalry can do so much?
Introduction of Time Bound Delivery
A New York court has now allowed for an extension of the filing of claims by an additional 90 days resulting in any such claim to be filed on or before 30th of August, 2024. SMEs can especially benefit from this extension since they have more time to sort things out and apply for claims.
For his part, Ryan Marth, one of the co-lead counsel who represented the merchants, reiterated, “This is real money for real businesses. “Thus, if you believe that you qualify for the above categories, do not procrastinate. You are not required to have a claim form before proceeding with the process.
