With a foray into financial services, Amazon.com could disrupt the decades-old card payments system, a move that some say could save the retailer $250 million a year in swipe fees.
Merchants have been challenging surcharge bans in numerous states on free-speech grounds. They have the wind at their backs following another court victory on Wednesday.
In a surprise move, the Supreme Court will decide whether Amex may bar merchants from steering customers to less expensive card networks. The card issuer will have to prove the consumer gain from its practices outweighs the merchant pain.
The Trump administration is stepping away from the government’s 7-year legal fight with Amex that centers on retailers’ right to encourage the use of particular cards. The decision is good news for issuers of credit and debit cards, though it is hardly the last word on the case.
The U.S. Supreme Court refused to revive a $5.7 billion settlement of retailer claims that Visa and Mastercard improperly fixed credit card swipe fees, in a rebuff that could mean years of additional litigation.
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Financial institutions see their best chance to repeal interchange debit fee caps, but merchants are confident they can prevent Congress from taking up the issue again.
