MasterCard Faces U.K. Suit over Interchange
MasterCard faces a $24.5 billion class action suit in the U.K. over its cross-border interchange fees. The suit arrives two years after the European Union labeled the interchange charged by the payment card network as unfair. European interchange caps went into effect in December of 2015.
The suit stems from former U.K. consumer financial services ombudsman Walter Merricks, who has hired U.S.-based law firm Quinn Emanuel to sue MasterCard under the British Consumer Rights Act of 2015, which enables class action status. Merricks claims the payment card network’s interchange is illegally high, and seeks refunds for consumers.
MasterCard offered no immediate comment but told Bloomberg News that it disputed Merricks’ claims and that “electronic payments deliver real value to people online, in-store and everywhere.”
Interchange is also a hot topic on the other side of the Atlantic. Last week, a U.S. federal court rejected a 4-year-old $5.7 billion interchange fee settlement. The decision earned praise from retailers, and has Visa and MasterCard gearing up for what could be years of ongoing ligation and perhaps a stop at the Supreme Court.