Green light for £14bn claim against Mastercard

‘Rip-off’ victims in line for £300

MASTERCARD could be forced to repay £14billion to consumers after the Supreme court gave the green light yesterday to a lawsuit against the card giant.

If it is successful, an estimated 46million people could be in line for refunds running to an average of more than £300 each.

The case revolves around rip-off charges imposed by Mastercard on retailers for processing credit and debit card payments over a 16-year period from May 1992 to June 2008. These ‘interchange fees’ were passed on to all shoppers in terms of higher prices on everything from a pair of shoes to the weekly groceries.

The case is being led by the UK’s former chief financial services ombudsman, Walter Merricks, and supported by the consumer group Which? The claim was initially filed at the competition Appeal Tribunal (cAT) in London in 2016, but the tribunal blocked the action in 2018.

That ruling was challenged by Mr Merricks and yesterday the Supreme court ordered that the cAT should reconsider the case.

The fact that the interchange fees were too high was established 14 years ago after legal action against Mastercard and others by the European commission. The group action against Mastercard is the first to be filed under the consumer rights Act 2015 on behalf of all UK consumers.

Mr Merricks said: ‘Mastercard imposed excessive card transaction charges. The prices of everything we all bought from 1992 to 2008 were higher than they should have been and the loss we collectively suffered amounts to about £14billion.’

Any UK residents over the age of 16 who bought goods or services from businesses that accepted Mastercard cards between those dates would be automatically included in the claim, unless they opt out.

If the action is successful, everyone who was over 16 throughout that period would get the same amount. But the case is a long way from being settled. First the CAT will have to rule that the charges were illegal and unfair. Mastercard could then try a new legal challenge.

Mastercard intends to continue fighting the case, which it claimed is ‘fundamentally flawed’. It said the ruling suggested the size of the claim was ‘very likely to prove to be a considerable over-estimate’.

It said: ‘We fundamentally disagree with this claim and know people have received valuable benefits from Mastercard’s technology.’

‘Fees meant prices were higher’