Illinois Credit Card Swipe Fee Law Sparks Legal Fight With Banks

Illinois is the first state to bar credit card companies such as Visa Inc. and Mastercard Inc. from charging swipe fees on retail tips and taxes, but implementation hurdles and likely litigation from banks means it may also be the last.

The Interchange Fee Prohibition Act was included in the Illinois omnibus budget bill (HB 4951) and signed into law by Gov. JB Pritzker (D) on June 7. Beginning in July 2025, credit card issuers won’t be able to collect interchange fees on sales and excise taxes and gratuities if a merchant elects to separate out those charges ...