Mastercard Agrees to £200M Settlement in UK Class Action Lawsuit—Check If You’re Eligible for a Payout

The UK’s Competition Appeal Tribunal (CAT) has officially approved a £200 million settlement between Mastercard and British consumers, bringing an end to a nine-year legal battle over excessive credit card fees. The lawsuit, which began in 2016, alleged that Mastercard’s interchange fees led to higher prices for consumers between 1992 and 2008.

This case is one of the largest collective legal actions in UK history, affecting approximately 46 million people. However, the settlement has sparked debate, particularly over the small individual payouts expected for consumers and the large legal fees claimed by lawyers and litigation funders.

Background: Why Did Mastercard Face Legal Action?

The class action was originally filed by Walter Merricks, former UK Financial Ombudsman, on behalf of consumers. The claim accused Mastercard of charging illegally high interchange fees—the fees retailers pay banks when customers use credit or debit cards.

Retailers allegedly passed these costs onto consumers, inflating prices for everyday goods and services. Merricks and his legal team argued that every adult in the UK who used a Mastercard or paid higher prices due to these fees between 1992 and 2008 should receive compensation.

The case was one of the first major opt-out class action lawsuits allowed under the Consumer Rights Act 2015, making it a landmark legal precedent in the UK.

Details of the £200M Settlement

After nearly a decade of legal disputes, Mastercard agreed to settle the case for £200 million in December 2024. The Competition Appeal Tribunal (CAT) reviewed the settlement and officially approved it in February 2025.

Here’s how the £200M will be distributed:

• Consumer Payouts: Half of the settlement will go directly to consumers who submit claims, but individual payments are expected to be less than £10 per person.
• Legal Fees: Lawyers representing the case are set to receive over £18 million.
• Litigation Funding Costs: Innsworth Advisors, the firm that financed the lawsuit, will take a significant share of the settlement.

Controversy Over Legal Fees and Payouts

While the settlement amount seems substantial, it has drawn criticism due to the low compensation for consumers and the large sums going to lawyers and litigation funders.

Who Benefits the Most?

• Innsworth Advisors, which funded the case, will receive a large share of the £200M settlement for their financial backing.
• Law firms involved in the case will claim £18 million in legal fees.
• The 46 million affected consumers will receive only a small fraction of the total sum, with estimates suggesting payments of £7-£10 per person.

Consumer Rights Groups have argued that the distribution of the settlement raises concerns about the fairness of large-scale class action cases.

Mastercard and Legal Representatives Respond

Mastercard welcomed the tribunal’s approval of the settlement, stating:
“We are pleased to have reached a resolution on this long-standing matter and remain committed to ensuring transparency and fairness in our payment systems.”

Walter Merricks, who led the lawsuit, also expressed his satisfaction:
“This is an important victory for UK consumers. While the individual payments may be small, this case sets a strong precedent for future class action lawsuits in the UK.”

However, Seema Kennedy, a representative of the consumer advocacy group Fair Civil Justice, criticized the outcome, saying:
“It cannot be right that third-party funders and legal teams take the majority of a settlement, leaving consumers with minimal compensation.”

How to Claim Your Settlement Payout

If you were affected by Mastercard’s interchange fees between 1992 and 2008, you may be eligible for a payout.

Steps to Claim:

1. Check Your Eligibility – If you were a UK resident during 1992-2008 and used a Mastercard or shopped at businesses accepting Mastercard, you may qualify.
2. Submit a Claim – The claims process is expected to be launched soon. Keep an eye on the official settlement website (to be announced).
3. Wait for Approval – Once verified, you will receive your small payout (likely under £10) directly to your bank account.

Implications for Future Class Action Lawsuits

The Mastercard settlement is a landmark case for UK consumer rights and class action lawsuits. However, it highlights key issues:

• Effectiveness of Class Actions – While collective lawsuits can hold corporations accountable, they often result in small payouts for individuals.
• Legal Costs vs. Consumer Benefits – The case raises concerns about whether lawyers and funders benefit more than the actual consumers affected.
• Encouraging Corporate Accountability – Despite the low payouts, this case sets a legal precedent for companies engaging in anti-competitive practices.

Conclusion

The £200M Mastercard settlement marks a significant moment in UK consumer law, but it also exposes challenges in the legal system regarding fair compensation for affected individuals.

While Mastercard and the legal teams involved in the case consider it a successful resolution, many consumers feel the payouts are too small to make a real impact.

For now, UK residents should stay informed about how to claim their share of the settlement once the official claims process opens.

This article has been carefully fact-checked by our editorial team to ensure accuracy and eliminate any misleading information. We are committed to maintaining the highest standards of integrity in our content.