The settlement subject to court approval marks one of the mega antitrust settlements in US history.

Visa Mastercard agreement

Visa and Mastercard have reached a lawsuit settlement projected a $30 billion aimed at curbing debit card fees and credit card fees for merchants.

The step is taken to translate into savings for consumers through reduced prices. The settlement subject to court approval marks one of the mega antitrust settlements in US history addressing claims dating back to litigation started in 2005.

According to court documents the fees reduction and caps alone show a value of $29.79 billion. Visa has estimated that majority of setting merchants exceeding 90 per cent consist of small businesses.

Merchants have criticised Mastercard and Visa for what they perceive illegal swipe fees known as interchanges fees charged to customers using credit or debit cards.

Merchants have objected to anti steering rules preventing them from directing customers towards more cost effective payment methods.

Under the terms of settlement open up on Tuesday Mastercard and Visa have agreed to slash interchange rates by 4 basis 0.04 points within US for a period of three years.

The rates will be capped for 5 years. In a separate case last March The federal appeal courts in Manhattan upheld a related $5.6 billion class action settlement by Mastercard and Visa benefitting almost 12 million merchants.

This previous settlement did not address the specifics of fees imposed by Mastercard and Visa and retailers were not covered by provisions.