NEW YORK – Visa and Mastercard announced a revised settlement with merchants who accused the card networks of charging too much to accept their credit cards, after a judge rejected an earlier $30 billion accord as inadequate.

Monday’s settlement would end 20 years of litigation in which businesses accused Visa, Mastercard and banks of conspiring to violate U.S. antitrust laws, including through the card networks’ collection of “swipe fees” to process transactions.

But the new accord is already drawing opposition from merchants who say it doesn’t address concerns that U.S. District Judge Margo Brodie in Brooklyn, N.Y., whose approval is required, raised in rejecting the earlier settlement in June 2024.

Also known as interchange fees, swipe fees totaled $111.2 billion in the United States in 2024, up from $100.8 billion in 2023 and quadruple the level in 2009, according to the National Retail Federation, the largest U.S. retail trade group.

The settlement calls for Visa and Mastercard to lower swipe fees, which are now typically 2% to 2.5%, by 0.1 percentage points for five years.

Merchants would be able to choose whether to accept U.S. cards in specific categories including commercial cards, premium consumer cards including many popular “rewards” cards, and standard consumer cards.

Standard consumer rates would be capped at 1.25% for eight years. Merchants would also get more options to impose surcharges when people pay by credit card.

Visa, based in San Francisco, said the settlement provides merchants “of all sizes” with meaningful relief, more flexibility and options to control how customers pay them.

Mastercard, based in Purchase, N.Y, said smaller merchants in particular would benefit from more flexibility, lower costs and simpler rules, with businesses and consumers enjoying a “better payments experience.”

The $30 billion settlement would have lowered swipe fees by about 0.07 percentage points over five years, and also given merchants more room to impose surcharges.

But in rejecting that accord, Brodie said fees would remain above where they would be absent the antitrust violations, and the $6 billion of annual savings for merchants was “paltry” relative to how much Visa and Mastercard could still charge.

She also faulted the accord for sticking merchants with the “Honor All Cards” rule requiring that they accept all Visa and Mastercard cards, or none.

Merchants have also long accused Visa and Mastercard of enforcing “anti-steering” rules that prevent businesses from directing customers toward cheaper means of payment.

Doug Kantor, general counsel of the National Association of Convenience Stores, said the settlement doesn’t give banks an incentive to lower rates they charge while it lets Visa and Mastercard raise their own rates “without any limitation.”

He also said merchants can’t simply turn away holders of rewards cards, which account for more than 80% of credit cards.

“Merchants can’t afford to say no to most of the cards out there,” Kantor said in an interview.