Discover Financial Services will pay approximately $1.2 billion in 2026 to settle three lawsuits over allegations that the company misclassified certain credit cards for merchant fee purposes.
The settlement resolves disputes regarding how Discover categorized its cards when determining interchange fees charged to merchants. By misclassifying cards into higher fee categories than warranted, Discover allegedly increased costs for merchants who accepted its cards. Texas credit card users are among those eligible to receive a portion of the settlement payout.
The payment structure spans multiple years, with the $1.2 billion settlement to be distributed beginning in 2026. Eligible cardholders and merchants affected by the misclassification practices will be notified about claiming their share of the settlement.