Millions of UK shoppers are set to receive compensation following a £200 million settlement approved in a long-running legal battle against Mastercard. The case, which stems from fees levied on businesses between 1992 and 2008, concludes nearly a decade of litigation led by former financial ombudsman Walter Merricks.
The settlement highlights the broader impact of card payment fees on everyday consumers, who, although not directly charged, ultimately bore the costs through higher prices. This landmark ruling opens the door for millions across the UK to claim their share of the compensation, marking one of the most significant class actions in British consumer law.
Background and Eligibility Criteria for the Mastercard Settlement
The legal dispute originated from a 2007 European Commission ruling that found Mastercard’s multilateral interchange fees, charged to businesses accepting Mastercard payments, breached competition laws.
These fees, although paid by retailers, were alleged to have been passed onto consumers via inflated prices for goods and services over a 15-year period from 1992 to 2008.
Walter Merricks argued that this indirect overcharging affected approximately 46 million shoppers across the UK, making it one of the largest consumer compensation claims in recent history. The Competition Appeal Tribunal finally approved the £200 million settlement, with £100 million allocated specifically for consumer claims.
Eligibility extends to those who lived in England, Wales, or Northern Ireland for at least three months between June 1997 and June 2008, and in Scotland from May 1992. Consumers do not need to have owned a Mastercard to claim compensation, provided they purchased goods or services from businesses accepting Mastercard credit cards.
Claims Process and Implications for UK Consumers
Consumers eligible to claim must register by completing an online form expected to open shortly, according to statements from Mr Merricks. Claims must be submitted before the end of the current year to qualify for a payout. If the estimated 5% of claimants, approximately 2.5 million people, apply, the individual compensation is expected to be around £45.
Should fewer people come forward, the payout could increase up to £70 per claimant.
Mr Merricks described the settlement as a “fair and just outcome” for UK consumers, stressing that while the fees were paid by retailers, the costs were ultimately transferred to shoppers in the form of higher prices.
He acknowledged that only a “relatively small proportion of transactions” were affected but underlined that recovering £200 million for consumers represents a meaningful financial restitution.
Unclaimed funds from the settlement are anticipated to revert to the company that financed the lawsuit. Mastercard declined to comment on the court’s ruling.
This case also exemplifies the growing power of consumer rights legislation in the UK, following the introduction of the Consumer Rights Act 2015, which facilitated US-style class actions for competition claims. For millions of UK consumers, the settlement offers a tangible redress for years of indirect overpayment linked to Mastercard fees.
