Wal-Mart opposed to $6B card fee settlement
BENTONVILLE, Ark. (AP) — Wal-Mart Stores Inc. urged retailers to reject a proposed $6 billion settlement that Visa Inc., MasterCard Inc. and major banks have agreed to pay retailers for alleged fee fixing.
The settlement, reached earlier this month, had been considered a victory for retailers. It settled a lawsuit that claimed card issuers conspired to fix merchants' fees for accepting credit cards. Retailers have long complained about the billions of dollars in "swipe" or "interchange" fees that that they have had to pay, which average about 2 percent of the price of a purchase.
Under the settlement, stores will be allowed to charge customers more if they pay with a credit card.
But the world's largest retailer said Tuesday that the settlement doesn't restrict credit card issuers from continually raising fees merchants must pay when shoppers use their cards. The Bentonville, Ark., company also says the settlement would require retailers to waive their rights to take action against card issuers.
"As Walmart continues to seek reform that will provide transparency and true competition among financial institutions, we encourage all merchants to put consumers first and reject the settlement," Wal-Mart said in a statement.
Wal-Mart joins Target Corp. in speaking out against the settlement.
On Friday, Target said the proposed settlement would "perpetuate a broken system, restrict retailers from any future legal action and offer no long-term relief for retailers or consumers."
And earlier in July, the National Association of Convenience Stores said it would fight the settlement because the group doesn't think the settlement adequately addresses the issue of how much control Visa, MasterCard and banks have over merchants.
MasterCard responded to Wal-Mart's statement by saying that said that while some retailers have different opinions, the settlement was reached after years of litigation and months of negotiating.
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