Visa and Mastercard face new £600 million consumer claim over card payment fees

Around 43 million UK consumers who paid higher prices for insurance, travel and cash services could be entitled to compensation.

A new collective action is being launched against Visa and Mastercard on behalf of around 43 million UK consumers who are alleged to have paid higher prices for goods and services as a result of card payment fees that were allegedly set at unlawfully high levels.

Justin Le Patourel, a former Ofcom consumer policy lead who is also bringing a £899 million claim against Apple and Amazon, has instructed Milberg London to bring the claim against both card schemes for alleged breaches of UK competition law.

The claim alleges that Visa and Mastercard set card payment fees at unlawfully high levels, with those costs ultimately passed on to consumers through higher prices. The Competition Appeal Tribunal has already made findings on these fees in earlier related proceedings.

Le Patourel said:

“Millions of people may have paid more than they should have because of card fees that were ultimately passed on in the price of everyday goods and services. This claim is about getting money back for consumers who were affected, and making sure powerful payment companies are held to account when competition rules are broken”

This new consumer claim seeks to recover hundreds of millions of pounds for those affected, particularly in the insurance, travel and cash services sectors.

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How Visa and Mastercard card fees led to higher prices for consumers

Every time a consumer pays by card, a fee is charged behind the scenes between the banks involved in processing the payment. The claim alleges that Visa and Mastercard set and maintained these fees at unlawfully high levels, and that businesses in certain sectors passed those costs on to consumers through higher prices.

The Tribunal has already made findings on the lawfulness of these fees in earlier related proceedings. A further ruling found that some of the costs were passed on to consumers in three sectors: insurance, travel and cash services. This new claim builds on those findings and seeks to recover compensation for the consumers who ultimately footed the bill.

Milberg London has written to Visa and Mastercard setting out the basis of the claim and expects to file it with the Tribunal imminently.

Could you have been affected? 

Most consumers would not have known if they were paying these fees. They were charged behind the scenes when card payments were processed, with the claim alleging that some businesses passed the costs on through higher prices.

The claim is focused on three sectors where the Tribunal has found that some card fees costs were passed on to consumers: 

• Insurance – including purchasers of car insurance and home and contents insurance.
• Travel – including purchasers of holidays booked through online travel agencies (OTAs) or other online intermediaries.
• Cash services – including users of international money transfer services, such as Moneycorp, MoneyGram, Revolut, Wise (formerly TransferWise), Travelex, Western Union or WorldFirst.

The claim covers all consumers who purchased goods or services from businesses in these sectors, not only those who paid by Visa or Mastercard card themselves – because the higher costs are alleged to have been passed on through the prices charged to all customers, regardless of how they paid. 

Other sectors could also be affected,which may also be covered by the claim. The Tribunal has recognised that there could be other merchants or sectors of the economy that have also passed on these costs to consumers, beyond those covered by its existing findings. 

The claim is being brought on behalf of eligible UK consumers, who would be included automatically if the case is approved by the Tribunal, unless they later choose not to take part. 

What happens next in the Visa and Mastercard claim

Once filed, the Tribunal will need to certify the claim before it can proceed. This involves assessing whether the claim is suitable to be brought as a collective action and whether Le Patourel is an appropriate class representative.

If certified, the claim is expected to be heard alongside related claims already being brought by businesses that accepted Visa and Mastercard payments, with further hearings expected in 2027 and 2028.

This is separate from the earlier Mastercard claim brought by Walter Merricks, which related to Mastercard fees between 1992 and 2008 and has since settled for £200 million, although payments to consumers have been delayed. 

Le Patourel’s claim is against both Visa and Mastercard, covers a later period and focuses on insurance, travel and cash services.

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