The settlement, if approved, would resolve lawsuits brought as far back as 2005 by retailers who allege the credit card companies fixed debit and credit card swipe fees. Swipe fees are a small percentage of the purchase price and are taken by the companies on every transaction made using their cards.
According to the terms of the settlement, filed in federal court in New York, Visa will pay $4.03 billion and MasterCard will pay $2.02 billion to a class of merchants, including small businesses and stores.
Additionally, both Visa and MasterCard will also agree to cut swipe fees by 10 basis points (0.1 percent) for eight months, which amounts to an additional $1.2 billion in relief for merchants.
The settlement also allows merchants and stores to impose a "checkout fee"to pass onto consumers, which is limited by a cap.
Also included in the proposed settlement are credit card issuers such as JPMorgan Chase, Capital One, and Bank of America.