SAN FRANCISCO- Late in the evening of April 30, negotiators for VISA and the coalition of leading retailers reached a reportedly $2 billion settlement in their long-standing dispute over interchange rates and the honor all cards rule. VISA's settlement in the case follows by a day a similar settlement by MasterCard. Both Visa and MasterCard's honor all cards rules stated that if a retailer took either card association's credit card, they also had to take the association's debit card as well. The interchange rate on the debit cards that required the cardholder to sign for validation have been significantly higher than the interchange on transactions in which a customer enters a personal identification number for validation. Although the terms of the settlement have not been made public, Daniel Tarman, a VISA vice president, said that the association had agreed to "modify" the policy. "Beginning January 2004, merchants will decide whether they want to continue to accept Visa's popular debit products. We are confident merchants will continue to accept the popular debit card providing customers with the widest array of payment options, and we are pleased that our cardholders will continue to enjoy all the benefits and features Visa cards offer," Tarman said.