Judge Brian Cogan holds the final approval hearing on the Visa-Mastercard swipe fee settlement Monday, Nov. 16, in Brooklyn, while roughly 1,000 merchants ask him to say no.
If you sell on cards, this deal decides three things: whether credit interchange drops by 0.1 percentage point, whether merchants can turn away some premium cards, and whether a surcharge of up to 3% becomes a normal checkout tool. I follow it at Ecommerce Paradise for one reason. Every large order in a high-ticket dropshipping store pays card fees, and the whole model leans on buyers who pay with cards.
The fee cut is small. The rule changes are the part that could reshape checkout. Below is what the court is weighing, how the case got here, what the numbers mean for a store, and five things to do this week. If you want the money side of the older case first, my post on the $631.7M merchants have been paid so far covers it.
Fee numbers only help if your books show them. Put card processing fees on their own line in QuickBooks so you can see what swipe fees cost your store before and after any ruling. Set up your store books in QuickBooks →
Visa-Mastercard Settlement: What Judge Cogan Decides Nov. 16
U.S. District Judge Brian Cogan will decide whether to give final approval to a settlement Visa and Mastercard reached with U.S. merchants. The hearing is set for Nov. 16 in Brooklyn, according to Payments Dive’s Oct. 16 report. Cogan granted preliminary approval June 9, and Reuters put the deal at US$38 billion at the time.
Here are the terms as Payments Dive described them. Credit interchange would fall 10 basis points, or 0.1 percentage point, for five years. A 1.25% rate would apply to standard consumer cards for eight years. Merchants could decline some higher-cost premium and commercial credit cards, which departs from the long-standing honor all cards rule. Merchants would also gain rights to add surcharges and offer discounts that steer customers toward cheaper cards.
The surcharge ceiling matters for your checkout. Payments Dive reported in July that merchants could surcharge up to 3% to cover costs on premium and commercial cards. Visa’s own merchant page already says merchants must notify their acquirer 30 days before they begin surcharging. That page did not state a cap when I checked, so the 3% figure comes from the settlement coverage and not from Visa.
Opposition is loud. On Sept. 14, Walmart, Circle K and the National Association of Convenience Stores asked Cogan to reject final approval and to let them opt out of the class, per Payments Dive. Walmart’s filing runs 299 pages and argues that forced participation raises Fifth Amendment takings problems. In the filing’s words, “There has never been a mandatory (class action) settlement like this.”
About 1,000 merchants and trade groups have filed objections in total. That includes 29 merchants such as The Cigna Group, DoorDash, General Motors and Peet’s Coffee, plus the National Retail Federation and the Retail Industry Leaders Association, which cited constitutional “infirmities.”
Visa and Mastercard answered in a joint reply filed Oct. 14. Their lawyers wrote that the objections “merely reprise the same arguments this Court already considered and rejected.” They described Walmart and the large trade groups as a “vocal minority” in a class of more than 12 million merchants. Class counsel filed its own reply under seal, and Cogan asked the lawyers to propose redactions.
The baseline is large. Merchants paid a weighted average of 2.35% on Visa and Mastercard transactions in 2024, per the Nilson Report as cited by Payments Dive. The Merchants Payments Coalition says swipe fees rose 80% since 2020 to a record $198 billion last year, and the grocery trade group FMI noted that the EU caps comparable fees at 0.3% per transaction.
Money is also in dispute inside the class. Plaintiffs’ counsel objected to a $36 million fee request from 18 merchant-plaintiffs, including Crate & Barrel, Dick’s Sporting Goods, The Gap and Yum! Brands. If the court grants that request, class counsel’s own fees would drop to $170 million, per Payments Dive.
One thing I could not confirm is a start date. None of the coverage I reviewed gives a date when the fee cut, the standard-card rate or the premium-card changes would take effect. Payments Dive’s July report says the settlement still has to survive appeals.
How the $38 Billion Swipe Fee Deal Reached Final Review
The litigation dates to 2005, per Payments Dive. Lawyers reached this deal about a year ago, and it is the second attempt. Cogan rejected a 2024 settlement, then granted preliminary approval to this one in June after finding it superior to the earlier version.
At the June approval the judge called the deal “fair, reasonable, and adequate,” according to Payments Dive’s coverage of the ruling. Retailers had been pushing back for months by then, and Bloomberg reported in April that retailers battling swipe fees were pushing back on the settlement.
Both sides of this fight have a stake, so here are both. The Merchants Payments Coalition describes the fee cut as minuscule and warns that the networks could raise fees freely once the temporary cuts expire. The Electronic Payments Coalition argues the opposite, saying the concessions total more than $200 billion over eight years and that large retailers and their lobbyists want to block the deal. Both figures come from advocacy groups.
The political fight runs alongside the court fight. I covered it when Trump backed the Credit Card Competition Act.
The debit side moved separately. An appeals court struck the Fed’s debit swipe fee cap, which is a different rule from anything Cogan will rule on. The Nov. 10 Paradise Report has the surrounding ecommerce news.
What a 0.1-Point Fee Cut Means for a High-Ticket Store
This section is my opinion and my rough math, not reporting.
High-ticket stores feel card fees more than low-ticket stores because the dollar fee scales with the order. A $3,000 order at the 2.35% average costs $70.50 to accept, and a 0.1-point cut takes $3.00 off that. Hypothetical: a store with $80,000 a month in card sales pays about $1,880 a month at 2.35%, so the cut is worth $80 a month, or $960 a year. That is real money, and it is not a business plan.
The cut is the least interesting part. I care more about premium cards, because the buyers I like to sell to are older, higher-income and comfortable paying by card, and many of them carry rewards cards that cost more to accept. That is my read of the buyer, not data from the settlement.
Refusing cards is the other headline right, and I think it gets oversold. Payments Dive notes that large merchants argue they cannot easily reject premium cards because customers value them. The same logic holds for a high-ticket store. Turning away a buyer with a $4,000 cart to avoid a fee that is a few percent of that order rarely pencils out. I read the right to refuse as a negotiating lever with your processor more than a daily tool.
Here is the surcharge math, again hypothetical. Assume a 25% gross margin, which sits inside the 20% to 30% range I use for high-ticket stores. A 3% surcharge brings in three cents per dollar from buyers who stay. Each dollar of premium-card sales that walks away costs about 25 cents of gross profit. The surcharge breaks even when roughly 11% of surcharged buyers leave, and above that you lose money.
A J.D. Power survey cited by Payments Dive found about 32% of customers occasionally or frequently abandon a transaction when they hit a surcharge. That is a different measure than a per-order walk-away rate, but it tells me 11% is not a safe bet on a $3,000 purchase. About 35% of small businesses in that survey surcharge anyway, and I would not copy them without testing.
A discount is the gentler tool. Offering 2% off for ACH or wire on orders above $2,500 steers buyers away from expensive cards without printing a surcharge line on the receipt. A Mercury business account can receive both ACH and wire transfers, and it keeps store money separate from personal money.
Now the scenarios. If Cogan approves, expect Walmart and the trade groups to appeal, so I would not build a lower fee into 2027 pricing. If he rejects, the case goes back into a fight that started in 2005 and the premium-card rules stay as they are. Either way, I would not expect a ruling at the hearing itself.
Flat-rate pricing adds a wrinkle. Stripe, Square and PayPal charge a fixed percentage plus a fixed fee, so a 10-basis-point interchange cut may not change your rate unless the processor passes it on. My Stripe fee calculator shows what you keep per payment.
The Stripe vs PayPal comparison covers payouts and holds. If your volume is large enough to ask about interchange-plus pricing, start with my guide to merchant accounts for ecommerce.
Any checkout change can move disputes. If you add a surcharge line or a new payment method, watch your chargeback ratio in the first 60 days. ClearSale is one of the fraud and chargeback protection options I point store owners to when order values climb.
All of this is operator complexity: processor contracts, state surcharge rules, bookkeeping and disputes on top of sourcing and ads. If you would rather have a team handle the store build and the payments setup, that is what my turnkey done-for-you service does.
Premium cards are the center of this fight, and you probably carry a few yourself. See which business cards earn their keep for store owners. See my business credit card picks →
Swipe Fee Settlement Action Steps for Store Owners This Week
Do these five in order. None of them requires waiting for the ruling.
- Pull your last three months of processor statements and divide total fees by total card volume. Compare the result to the 2.35% average. If you run Shopify Payments, my Shopify fees breakdown lists the rate by plan.
- Ask your processor for a volume report by card type: debit, standard credit, rewards and commercial. You need the premium share of your volume before any surcharge or discount decision makes sense. If they cannot produce it, that tells you something about the contract you signed.
- Do not add a surcharge yet. The settlement terms are not in force, and a surcharge that violates your state’s rules or your acquirer’s notice requirement can cost more than it collects. Roughly 40 states allow surcharges and some, including Colorado and Georgia, regulate the size, per Payments Dive. Visa also requires 30 days of notice to your acquirer, so there is no same-day switch.
- Test a wire or ACH discount on your highest-ticket orders. Track how many buyers take it and whether conversion on those orders moves, then compare the saved fee to the discount you gave.
- Get your fee data into your books. Finaloop is built for ecommerce bookkeeping. My guide to QuickBooks credit card processing fees shows how the rates stack up. Then put Nov. 16 on your calendar and read the ruling when it lands.
Frequently Asked Questions
When is the final approval hearing?
Judge Brian Cogan holds it Nov. 16, 2026, in federal court in Brooklyn. Payments Dive says Cogan granted preliminary approval in June.
What happens if Cogan rejects the settlement?
The case goes back to litigation that began in 2005, and today’s card acceptance rules stay as they are. Cogan already rejected a 2024 settlement before granting preliminary approval to this one.
Will approval cut my card fees right away?
Not on the coverage I reviewed, which gives no start date and notes the deal must survive appeals. If you use flat-rate pricing, your rate may not change at all, so check your PayPal fee calculator numbers against your actual statements.
Can I start surcharging now?
The settlement terms are not in force. Visa’s page says merchants must notify their acquirer 30 days before they begin surcharging, and state law applies on top of that.
Would I be able to refuse premium cards?
The settlement would let merchants decline some higher-cost premium and commercial credit cards if it is approved. Payments Dive describes broad refusals as impractical for large merchants because customers value those cards.
Does this cover processor markups?
No. This deal concerns Visa and Mastercard interchange and rules, while your processor sets its own markup. That is a separate cost, as my post on Global Payments’ reported $699 merchant fee shows.
Do high-ticket stores feel this more than low-ticket stores?
Yes, because each order carries a bigger dollar fee. If you are still picking a category, grab my free high-ticket niches list. The full 150+ niche breakdown shows price points for each one.
Card fee rules keep moving, and your store still has to ship. Want my team to build and run your high-ticket store for you? See the turnkey done-for-you service →
That is the setup going into Monday. I will keep an eye on the docket and say plainly if the ruling changes how your store should price or accept cards. Subscribe to the YouTube channel for daily breakdowns. More breaking news coming through the day. Good luck out there.
Related Articles
If this was useful, these go deeper:
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- Square Fees Calculator 2026: What You Keep on Every Sale
- Chargeback Reason Codes: Visa, Mastercard, Amex and Discover Explained for Merchants
- Shopify QuickBooks Integration 2026: Options, Costs and Setup
- How to Open a Mercury Account in 2026: The Full Application Walkthrough
Trevor Fenner is an ecommerce entrepreneur and world traveler from Seattle, Washington, and the founder of Ecommerce Paradise, a platform focused on helping entrepreneurs build and scale profitable high-ticket ecommerce and dropshipping businesses. With over a decade of hands-on experience, Trevor specializes in high-ticket dropshipping strategy, niche and product selection, supplier recruiting and onboarding, Google & Bing Shopping ads, ecommerce SEO, and systems-driven automation and scaling. Through Ecommerce Paradise, he provides free education via in-depth guides like How to Start High-Ticket Dropshipping, advanced training through the High-Ticket Dropshipping Masterclass, and fully done-for-you turnkey ecommerce services for entrepreneurs who want a faster, more hands-off path to growth. Trevor is known for emphasizing sustainable, real-world ecommerce models over hype-driven tactics, helping store owners build scalable, sellable, and location-independent brands.
He maintains homes in Seattle and Bali, spends most of the year overseas, and usually returns to Seattle for about a month each summer.
