Posted: October 13, 2026 | Updated: October 13, 2026 at 2:19 PM
A proposed settlement that would lower credit card fees is facing strong opposition from Walmart, as well as hundreds of other retailers. They believe the proposed Visa-Mastercard settlement would not provide enough savings and would compromise their ability to challenge card fees in the future.
The issue matters to many businesses because credit card fees cut into profits from card sales. Credit card fees are a high cost for small retailers, restaurants, and other small businesses.
The main concern is not just how much money a merchant can save. Walmart and other retailers are questioning whether they should be obligated to abide by a settlement that may affect their future legal rights, with no other choice but to follow it.
Their objections raise an important issue: whether the proposed settlement is a fair deal or protects Visa and Mastercard more than the businesses that accept their cards. The settlement has received preliminary approval, but the court still needs to approve it, and it has yet to weigh the objections. Here’s what the dispute is about and what the merchants should do now.
The Visa-Mastercard settlement is part of a lengthy legal process dating back to 2005. The case concerns banks and credit card companies that allegedly abused their dominant market position to keep interchange fees high and restrict competition.
Interchange fees are the fees a merchant’s bank pays to the cardholder’s bank on each card purchase, at rates set by Visa and Mastercard, and they are passed through to the retailer.
These charges are often called swipe fees, even when customers insert their cards or tap to pay. Merchants have complained for years that these fees are too high and that they have little control over the charges. Businesses must accept popular credit cards because customers demand them.
The proposed swipe fee settlement would change certain aspects of the card networks, reduce certain interchange fees, and give merchants who accept different credit cards more flexibility. Many businesses feel the draft doesn’t go far enough, making only minor adjustments to existing fees. They worry it doesn’t address the fundamental issues in the current system.
Walmart and other companies believe the settlement offers insignificant benefits and restricts their future legal rights. They voiced concerns about the amount of savings, network protection, and the settlement’s exclusivity.
The first problem is that the planned fee decreases may not be impactful enough for businesses. Under the terms, Visa and Mastercard would permanently decrease their combined interchange rate by 10 basis points (0.10 percentage point) for about five years, with adjustments to specific interchange rates. However, as the objecting merchants argue, these changes will not significantly reduce merchants’ expenses.
While the adjustment might benefit businesses that spend the most on processing payments, it is hard to say a 10 basis point decrease will offset expenses for companies that only partially process credit card payments. Furthermore, as the merchants’ lawyers argue, interchange fees are limited, but processing expenses are not governed solely by interchange fees, and other processing costs are not expected to decrease.
Another aspect of the lawsuit is the legal protection the proposed settlement would give to Visa, Mastercard and several banks. Merchants claim the agreement could constrain their ability to take certain legal actions in the future, which is a serious problem because card fees and rules may change over time.
Businesses want to know whether they can sue later if they are not satisfied with new practices. Merchants believe that proposed savings do not compensate them for the legal rights they would lose. They ask the court to carefully consider what the settlement requires merchants to accept to obtain the supposed benefits. The impact on legal rights would ultimately depend on the final settlement and what is actually agreed to. It would be wrong to say that the agreement would prevent any further claims.
Walmart and other objecting merchants claim that businesses should not be bound by the settlement if they do not accept its terms. They believe that settlement may interfere with their legal rights and prevent them from making future business decisions, depriving them of a fundamental right to choose.
The objecting merchants have raised the Fifth and Fourteenth Amendments to the Constitution, which state that no one can be deprived of property or liberty without due process of law. Walmart raises the Takings Clause of the Fifth Amendment. Overall, the objecting merchants raise a valid fairness issue with the settlement in the context of businesses’ legal rights.
Although many merchants oppose the agreement, it could still benefit merchants by reducing payment-processing costs. First, the agreement would lower interchange fees for a set period and cap some rates. Second, it would give merchants more flexibility in accepting different kinds of Visa and Mastercard credit cards, including standard consumer, premium consumer, and commercial cards.
Under existing card network rules, merchants generally must accept the relevant cards within a network to participate in that network. The proposed agreement would permit certain differentiations between card categories. In addition to the terms highlighted above, the agreement modifies surcharges and discounts, subject to applicable rules and requirements.
Proponents believe that changes will give businesses more control over credit card acceptance and cost management. Meanwhile, opponents say the changes may be impractical, as refusing to accept certain premium cards may dissatisfy customers who want to take advantage of their rewards or other benefits. This leaves companies with the disagreeable choice of accepting higher-fee cards or losing out on a sale. That is why this proposed settlement is so contentious: proponents argue it provides useful changes, but objecting merchants believe it does not offer sufficient relief.
The next important step is the court’s ruling on the objections and request for final approval. The website listing the settlements shows a fairness hearing for November 16, 2026, at 11:00 a.m. At this hearing, the court will consider the parties’ argument for final approval of the settlement.
The hearing date does not necessarily mean that the court will make a final ruling on the settlement on that date. The court may need additional information before it can rule on the parties’ motion for final approval.
Several things could happen.
Merchants should not treat the proposed rule changes or reduced fees as in effect until the court issues its order. Businesses should rely on the published news and court decisions.
Merchants don’t have to wait for the court case’s outcome to re-evaluate their expenses. Today, companies can research and analyze their expenses and ways to reduce them while waiting for the class-action lawsuit’s outcome. Some of the ways of minimizing expenses are discussed below:
It is essential to examine all costs related to processing credit card payments. Payment processing usually involves several types of costs: interchange fees, processor fees, network usage fees, monthly charges, and others. Even though the proposed settlement concerns interchange fees and certain aspects of card network regulations, not all of the expenses will be affected
Thoroughly analyze current expenses to predict how the settlement may affect them.
Depending on the payment processing method, how you adjust costs will vary. Businesses on interchange-plus pricing will see any interchange reductions passed through on their statements. Companies on flat-rate pricing will see little change in their expenses.
Ask your payment processor how the new plan will affect your expenses and which processing costs will change. If any costs have decreased, review the new statement and compare it with the previous one.
Although the proposed changes to interchange fees and card network regulations seem to benefit merchants, it is unwise to change any payment policies before the settlement is finalized. Even if the judge rules the proposal a final victory for the merchants, the interchange changes will take time to implement. In addition, the existing credit card network regulations must still be considered.
Credit card network regulations are subject to various legal revisions, which may affect the business in different ways. If a merchant plans to impose surcharges on customers who pay with credit cards, it must analyze all relevant credit card regulations and restrictions. Merchants should carefully review any changes to credit card processing rules.
The ongoing class-action lawsuit is a good opportunity to reconsider your payment processing options. Merchants should choose a payment processor that offers the best overall value. Several payment processors may offer similar pricing plans, but differences in contract terms and customer support may affect the choice. When comparing payment processors, merchants should review every detail of the proposals instead of focusing only on the final price.
For businesses that process a large volume of payments, even a small difference in processing rates can lead to high costs. On the other hand, the cheapest flat-rate plan may cost more because of additional monthly charges.
Walmart and other merchants oppose the Visa-Mastercard settlement, arguing it offers limited benefits and challenges their legal rights.
The court gave the settlement preliminary approval, but final approval is still pending, so it is necessary to monitor further developments.
Until then, merchants should evaluate their expenses, consult with their processors, and take action only when more information becomes available.
The key takeaway: Do not make decisions based purely on proposed changes; understand what you pay now, keep your records in order, and wait for updates to be confirmed before making changes to your payment processes.
No. The case has received preliminary approval, but the Court must still approve the settlement before it can become final.
Not immediately. The changes may occur after the Court finally approves and implements the settlement.
The settlement proposal includes changes to surcharging practices, but you must comply with applicable laws and card network regulations.
