Visa and Mastercard have faced a lawsuit over alleged conspired vastly overcharge of the Square payment platform for increased retail prices for clients. Visa and Mastercard were accused of trying to fix inflated `interchange` fees and maintaining market power, according to a lawsuit filed by Block on July 14th, 2023, in the US District Court for the Easter District of New York.

Block’s Square payment processing platform was designed to directly contract with Visa and Mastercard in order to facilitate card transactions for numerous merchants. Square represents the direct payer of the interchange fees (also known in the industry as swipe fees), which are charged by Mastercard or by Visa, as well as their member banks for each client that uses a credit card or a debit card to make a transaction. Merchants and traders that leverage Square do not need to pay the interchange fees, but instead, they need to pay a separate set of fees that were set by the company for its payment and transaction solutions.

Block accused Visa and Mastercard of raising one of the fees that Square pays directly based on the number of locations a merchant or a trader has. According to the press release, neither Visa nor Mastercard did not respond to the allegations. Mastercard’s recent partnerships and product launches Mastercard had multiple collaborations and launches in the last couple of months, covering several geographic areas around the world.

In July 2023, the company announced its decision to use AI capabilities in order to fight real-time payment scams with its `Consumer Fraud Risk` services. The solution was made available in the UK at the time. By making use of AI-powered insights, Mastercard looked to improve the way banks and financial institutions predicted scams in real-time and before any money left the victim’s account.

The fraudulent activities were listed from romance scams to fictitious online deals, all of which have affected both people and companies in the past years. Moreover, they contributed to the loss of confidence and trust of those affected. With the Consumer Fraud Risk solution, Mastercard aimed to detect and prevent fraud and other online threats while making the environment more secure and efficient for customers and enterprises as well.

Mastercard collaborated with fintech Subaio in June 2023, to provide solutions for identifying and canceling recurring payments that were made using banking applications and online services. Both companies were set to enable clients to unsubscribe from unwanted tools, as well as the ones that were not used anymore. The product provided them with the needed visibility into their subscriptions and recurring payments within their own digital banking platform, no matter in which manner the user chose to pay.

The customers had to unsubscribe from the unwanted services directly within their digital banking application. .