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NewsBriefs

This article contains summaries of news stories recently posted under Although AWS restored services within hours, payments
Breaking Industry News on our homepage. For links to these and other experts warn the ripple effects will be far more costly and
full news stories, please visit www.greensheet.com/breakingnews.php. prolonged than the outage itself. Monica Eaton, founder
and CEO of Chargebacks911 and Fi911, said outages like
this "don't just cause downtime—they trigger a chain reac-
tion across the payment ecosystem." Failed authorizations,
duplicate charges, and missing confirmation pages create
confusion for customers, who often dispute a charge rath-
er than seek merchant support."

She urged merchants to act immediately rather than wait
for issuers to process disputes, recommending steps such
as auto-detecting duplicate transactions, messaging af-
fected customers before they contact their banks, and doc-
Visa, Mastercard to pay merchants umenting timestamps for representment evidence. "The
$199.5 million to settle antitrust suit outage will end long before the disputes do," she warned.
"Any business treating this as a one-day incident is al-
Visa and Mastercard agreed to pay a combined $199.5 mil- ready behind."
lion to settle a long-running class-action lawsuit brought
by merchants over the EMV liability shift introduced in The incident highlights the growing dependency of fin-
2015 and 2016. The shift made merchants financially re- tech and commerce infrastructure on cloud services.
sponsible for chargebacks tied to counterfeit card fraud if
they had not adopted EMV chip-enabled terminals—costs Fed may open payment rails to non-banks
that had previously been absorbed by issuing banks.
The Federal Reserve is exploring whether to grant direct
access to its payment systems to nonbank fintech firms, a
The lawsuit, originally filed in 2016 by several supermar- move that could reshape how payments clear and settle
kets and a liquor store, alleged that Visa, Mastercard, in the United States. Fed Governor Christopher Waller re-
American Express and Discover acted in violation of an- vealed the initiative during a payments innovation confer-
titrust laws by coordinating the transition in a way that ence in Washington, D.C., describing the potential creation
forced merchants into costly upgrades without reducing of a new type of "payment account" — or "skinny master
interchange or other associated fees. account" — that would allow legally eligible nonbanks to
access basic Fed payment services without becoming full
Although no wrongdoing was admitted, Visa agreed to financial institutions.
pay $119.7 million and Mastercard $79.8 million into a
common settlement fund. AmEx and Discover had al- Today, only banks and credit unions with master accounts
ready settled separately for $32.2 million. The settlement can directly access the Fed's payment rails, including Fed-
was finalized only after five separate mediations, accord- wire and the National Settlement Service. Fintechs must
ing to court filings, and must still be approved by both the instead rely on sponsor banks, creating dependency and
affected merchant class and the U.S. District Court for the additional cost. Waller suggested that for some high-vol-
Eastern District of New York.
ume payment firms, access to a simplified version of a
master account could remove barriers to competition and
Attorneys for the merchant class described the settlement innovation.
as "an excellent outcome" that balances the potential up-
side of continued litigation against the substantial time, The proposed accounts would differ from traditional mas-
cost and risk involved. Visa and Mastercard said they ter accounts in several ways: no interest would be paid
chose settlement to avoid prolonged litigation, not because on balances, funds would likely be capped, and account
they agreed with the allegations. holders would not receive daylight overdraft privileges or

AWS outage could spark discount-window lending access. Waller emphasized that
payment-dispute time bomb the Fed is only in an exploratory phase and that many risk,
regulatory and operational questions remain unresolved.
A major global outage at Amazon Web Services on Oct.
20, 2025, was expected to create weeks of fallout for mer- The Fed's slow pace in modernizing payments complicates
chants, processors and financial platforms due to a pro- expectations. Although FedNow launched in 2023 as a 24/7
jected surge in chargebacks and billing disputes. The dis- instant-payments service, legacy systems like Fedwire still
ruption originated in AWS's US-EAST-1 region and was operate only 22 hours per weekday, excluding weekends
linked to failures in both DNS and database APIs, causing and most holidays. A proposal to extend Fedwire's operat-
widespread downtime for apps and platforms including ing hours to six days per week would not be implemented
Venmo, Snapchat, Robinhood and multiple UK banks. until 2028 or later.

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