Visa and Mastercard's £5bn claim: what UK businesses should know

A £5 billion claim against Visa and Mastercard makes a loud headline. Most small businesses read it, wonder whether they are owed money, and get on with the day.

That reaction is fair. It also skips the more useful question. The claim is about one slice of what you pay to take a card. Whether or not it ever pays out, you can learn which slice you control.

This is a guide for UK owners who take cards. It covers what the claim says, what has and has not been decided, why the part of your bill you can change is not the part in the headline, and a short check you can run on your own statement.

A note on interest. Reeve Consult is an authorised DOJO payment consultant, so we have a stake in how businesses choose a provider. This article recommends no provider and contains no referral links.

What is the £5 billion claim about?

Irish Legal News reported on 28 October 2026 that the law firms Harcus Parker and Hausfeld have applied to the Competition Appeal Tribunal to bring a collective action over interchange fees. The claim seeks compensation for businesses it says were overcharged since October 2020. The £5 billion figure is reported as an estimate from sources close to the case. It is not a sum awarded.

Interchange is the fee that passes from your payment provider to the bank that issued your customer's card. Visa and Mastercard set the default level. The claim argues that this arrangement restricted competition and pushed up what businesses paid.

Both networks reject it. Mastercard said: "We strongly disagree with the basis of this claim." Visa said it believes interchange is "a critical component to maintaining a secure digital payments ecosystem".

Has anyone been awarded anything yet?

No. Coverage tends to blur three separate things, so it helps to keep them apart.

The new claim is an application. According to the report, it goes ahead only if the tribunal approves it. If it does, about one million UK businesses, organisations and charities with revenue below £100 million would be included automatically unless they opt out. Larger businesses would need to opt in.

An earlier case has already reached a ruling. In June 2025 the tribunal ruled in the Merchant Interchange Fee Umbrella Proceedings that the Default Interchange Fee Rule infringes Article 101(1) of the Treaty on the Functioning of the European Union, the competition rule. The same judgment said damages were still to be assessed. Visa and Mastercard are challenging it. Law firm and press reports say the Court of Appeal gave them permission to appeal in March 2026, but we could not find the court's own order, so treat that as reported rather than confirmed.

A separate trial looked at pass-on. That means whether providers passed lower interchange on to merchants. In February 2026 the tribunal found in its second trial that providers passed on all of the interchange fee on interchange-plus contracts and about 85 per cent on standard or blended contracts. That is a finding in that litigation. It is not a statement about your contract.

Which part of your card bill is interchange?

The Payment Systems Regulator describes the merchant service charge, the total your provider takes, as three parts. In its card-acquiring market review it lists interchange fees paid to the card issuer, scheme fees paid to Visa or Mastercard, and the provider's own revenue, which recovers its other costs and its margin.

On a blended or standard price you see one rate. The three parts are folded together, so you cannot tell how much is interchange. The same review found that more than 95 per cent of merchants were on standard pricing, and it concluded that the market "does not work well for small and medium-sized merchants".

Interchange-plus pricing shows interchange as its own line, then adds scheme fees and the provider's margin. It is not automatically cheaper. It is clearer, and clear is where a comparison starts.

Why the part you can change is not interchange

Here is the point that the headline hides. For most everyday payments from UK customers at UK businesses, interchange is capped. The PSR's December 2024 report states that the UK rules cap interchange on domestic consumer debit and credit card payments at 0.2 per cent and 0.3 per cent of the transaction value. Commercial cards sit outside those caps under Article 1 of the regulation. Cross-border payments follow different rules.

The caps limit interchange. They do not limit the total you pay. The PSR's page on the interchange regulation and merchants says the caps do not cap the merchant service charge. So when a bill looks high, the gap between capped interchange and your total is made of scheme fees, your provider's margin and fixed charges.

That is the opportunity in this news. You cannot negotiate interchange on a consumer debit payment. You can ask what your provider adds on top, and you can compare it with another quote. That is where a small business has bargaining power. Rules can change, so check the PSR's current page before you rely on any figure here.

A worked example you can adapt

Suppose a shop takes £10,000 in a month, all from UK consumer debit cards used in person. These numbers are an illustration, not a quote.

At the 0.2 per cent cap, interchange on that £10,000 is at most £20. Say the statement shows £140 in total charges. The effective rate is 1.4 per cent. At least £120 of that is something other than interchange: scheme fees, the provider's margin, or fixed charges such as terminal rental.

Now change the mix. If the same £10,000 were all consumer credit, the cap would allow up to £30 of interchange. A business-card payment is not capped, so a statement with many business cards can fairly show more.

The lesson is not that £140 is wrong. It is that you should be able to point to where each pound went. If you cannot, ask.

How do you check your own statement?

Set aside twenty minutes with your last three statements and the original pricing agreement.

1. Work out your effective rate. Add up the month's card takings and the month's total charges. Divide the charges by the takings.
2. Sort the charges. Put each line in one of three groups: charges that move with sales, fixed monthly charges, and one-off charges.
3. Ask for the breakdown. If you pay a blended or standard price, ask your provider for the interchange and scheme fee detail. Since 2023, providers must offer summary boxes and online quotation tools to businesses with turnover up to £50 million, under the PSR's remedies decision.
4. Check your contract length. For businesses with turnover up to £10 million, the same decision limits card terminal contracts to 18 months, then rolling terms of 31 days or less.
5. Put the answers in writing. Keep them with your statements.

Our guide to reading a UK merchant statement line by line explains the jargon, and the card processing rate analyser lets you compare your effective rate with other pricing. If your business is a restaurant or takes payments across a counter, our card payment services and restaurant payments page show how we approach a review. For the background on the caps, see our explainer on UK interchange fee caps.

What should you ask your provider?

Put these four questions in an email. Written answers are easier to compare than a phone call, and they give you a record.

• Which pricing model am I on? Blended, interchange-plus or fixed. Ask to see last month's interchange and scheme fees as separate figures.
• What are my fixed charges, and when does my contract end? Terminal rental, gateway fees, compliance fees and any minimum monthly charge belong here.
• What happens to my rate if my card mix changes? More business cards or overseas cards can lift interchange, because those payments are not capped in the same way.
• What would you quote me today? Ask for the rate you would offer a new customer with the same sales. Long-standing customers do not always get the best price.

Providers differ in how clearly they answer. A clear answer is a good sign. A vague one tells you what to do next.

What should you do about the claim itself?

Keep your statements, contracts and pricing letters from October 2020 onwards. If the claim proceeds, records make everything easier. Do not count on money.

If the tribunal approves the claim, the class representative must send a plain-language notice explaining how to opt out and by when. That is what the tribunal's guide to proceedings says, although that edition is from 2015, so check it is current. A business that opts out is not bound by the result and may bring its own claim. Read the notice when it arrives. If the sums matter to you, take legal advice. We cannot advise on your legal position.

Do not switch provider because of a headline. A switch should answer a problem you can name: unclear costs, a contract that no longer fits, or equipment that does not suit how you trade. Our step-by-step guide to switching card payment provider covers that decision.

The short version

The £5 billion figure will keep drawing attention until the tribunal rules, and that may take years. The task that matters now is smaller and closer to home.

Pick one statement this week. Work out the effective rate. Find the three lines you cannot explain, and ask your provider about each one. It takes less time than reading the coverage, and it works whatever the court decides.