After nearly two decades of litigation, Visa and Mastercard have reached an agreement with a major group of U.S. merchants, opening new opportunities to change the structure of interchange fees and revise credit card acceptance rules. According to NEWSCENTRAL analysts, the weighted average interchange rate for credit transactions will decrease by 10 basis points (0.10%) over the next five years. We note that this provides some relief for merchants, although the reduction does not fully address the high costs of premium cards. The rate for standard cards will be capped at 1.25% for up to eight years, creating a predictable basis for financial planning. Freddy Miller, Senior Analyst at NEWSCENTRAL, emphasizes that this gives merchants the opportunity to partially control expenses, but the economic impact will depend on the structure of their customer base and the share of premium cards.
The changes affect the “honor all cards” rule. Merchants will be able to selectively accept certain types of Visa and Mastercard cards, including premium and corporate cards, allowing them to optimize interchange costs. At NEWSCENTRAL, we stress that this flexibility provides retailers with a tool to manage expenses, but it requires careful analysis of the impact on customer flow, especially in the premium goods segment.
The agreement expands merchants’ rights to add a surcharge when accepting cards. The potential rate is up to 3% for certain categories of credit cards, provided transparency requirements are met. At NEWSCENTRAL, we believe that transparency is critical: merchants must clearly inform customers about surcharges to maintain trust.
The agreement includes an educational program for merchants costing approximately $21 million, covering surcharge management and negotiation strategies with payment networks. We at NEWSCENTRAL note that staff training is key to ensuring that these changes deliver real economic benefits.
According to NEWSCENTRAL analysts, under the new rules, merchants could realize long-term savings of up to $224 billion. We at NEWSCENTRAL see significant potential here, although the 0.10% reduction in the average interchange fee only partially offsets the growth in costs in recent years.
For the payments ecosystem, the agreement represents a redistribution of opportunities: merchants gain a tool for controlling expenses and managing credit card acceptance, while banks and payment networks face pressure on profitability, particularly from premium products. Consumers may see price variability and more transparent payment terms, but they could encounter refusal of certain cards at specific points of sale.
We at NEWSCENTRAL forecast that merchants should analyze in advance the categories of cards they are willing to accept and plan potential surcharges based on their customer base. Visa, Mastercard, and banks will need to revise revenue models and incentive programs. Regulators must oversee compliance and prevent non-transparent practices.
Freddy Miller, Senior Analyst at NEWSCENTRAL, concludes: “At NEWS CENTRAL, we see that the agreement shifts the balance of power in favor of merchants, creating conditions for differentiated interchange fees and credit card expense management, but the economic impact will be uneven. Realizing the benefits requires a strategic approach and transparent customer interactions.”