Visa and Mastercard are facing a potential £5bn lawsuit in the UK over accusations that they have stifled competition and charged businesses excessive fees. The law firms Harcus Parker and Hausfeld have lodged an application at the Competition Appeal Tribunal to pursue a group claim seeking compensation for companies they say have been overcharged on customer card payments since October 2020.
The claim centres on multilateral interchange fees, which are set by Visa and Mastercard and paid by businesses through their banks each time a customer uses a card. The legal teams argue that the lack of competition has left businesses with no choice but to pay higher fees on debit, credit and prepaid cards. Sources close to the claim estimate it could be worth about £5bn based on the number of businesses allegedly overcharged between 2020 and 2026. The case is seeking to recover fees charged over the past six years plus interest on those losses.
If the application succeeds, approximately 1m UK-based businesses, organisations and charities with revenues under £100m will be automatically included for compensation unless they opt out. Individual claims could be worth several thousands of pounds each. Larger businesses would need to actively opt in to the claim and could be due tens of millions over the claim period. The litigation is being funded by Bench Walk Advisors, a London-based firm launched in 2017 that backs lawsuits, and is led by Stephen Allen, a British businessman and former travel sector executive who has pursued the two companies through group legal actions since 2021.
Mastercard said the potential group claim was "speculative" and reflected a "growing trend of opportunistic funder-backed litigation". A Visa spokesperson stated that interchange is "a critical component to maintaining a secure digital payments ecosystem that benefits all parties, including consumers, merchants and banks". However, such cases can take years to reach conclusion. Visa and Mastercard settled a US class action lawsuit last year for a combined $167.5m over allegations they conspired to keep ATM access fees artificially high, though that original case was filed in 2011.