SAN FRANCISCO—Visa Inc. will make huge changes to its interchange rates, with lower rates for real estate and education categories and higher rates for e-commerce transactions, Bloomberg reports.
“The U.S. credit interchange structure has been largely unchanged for the past 10 years,” Visa said in a statement. “Based on the most recent review in the U.S., Visa is adjusting its default U.S. interchange rate structure to optimize acceptance and usage and reflect the current value of Visa products.”
Contention already abounds between retailers and payment networks, such as Visa and Mastercard, with merchants shelling out more than $100 billion in annual fees to accept electronic payments. The new rates will be in effect in April and October under a two-pronged implementation to provide more time to processors.
The changes apply to Visa’s published rates, and it’s unclear whether the firm will re-negotiate its one-on-one deals with retailers. Visa included new categories, such as vending machines, parking and rent, in the news release.
In December, Judge Margo Brodie of the U.S. District Court for the Eastern District of New York approved a $5.54 billion settlement in the long-running litigation brought by NACS and other merchants against Visa, MasterCard and the largest card-issuing banks (Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, MDL 1720).
Last May, the European Union has accepted an offer from Visa and Mastercard to cut fees on payments made by tourists using cards issued outside the bloc. This agreement could cut such fees by 40% on average, a benefit for both merchants and consumers.