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British businesses are set to get more business from customers in the European Union (EU) under legal plans to cut up to £200million a year from transfer fees.
Cross-border fees are charged to customers in the European single market when using credit and debit cards to buy online from UK businesses.
Some of these fees have been higher since 2021, when Mastercard and Visa begin to increase from 0.2 percent to 1.15 percent for credit cards and 0.3 percent to 1.5 percent for debit cards. no.
The Payment Systems Regulator (PSR) is now considering plans to cut these fees. They are estimated to add £150million to £200million a year to the cost of European purchases of British goods.
A PSR statement said: ‘The PSR sees this as detrimental to the interests of British businesses and their customers.’
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The PSR is currently considering whether to cap these costs and, if so, at what level.
Caps are temporary and should be placed at a permanent level.
PSR managing director David Geale said: ‘Cards are a popular way of paying in the UK.
‘Our findings confirmed that, due to a lack of competition, Mastercard and Visa were able to raise cross border fees to the highest level, costing UK businesses hundreds of millions of pounds.
‘We think that talking about a range of options for closing costs is the best way forward to make it better for British businesses.’
The PSR is collecting feedback on its consultation until 7 February 2025, which will outline plans for next year’s budget.
A Visa spokesman said: ‘We continue to challenge all of the PSR’s findings and it is important that the measures do not lead to uncertainty and unintended consequences.’
A Mastercard spokesman said: ‘The artificial controls on transactions do not reflect the commercial reality of the current market and, if not set at the appropriate level, could adversely affect the value of transactions. individuals and businesses receive credit card payments.’
