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A major revolution in the card payment industry is taking place, and retailers are set to be the big winners. Across the entire European Union, whenever a customer uses a payment card, retailers can only be charged 0.2 per cent of the total transaction with a debit card or 0.3 per cent for credit cards. Before the cap, retailers were charged seven or eight times more, and Edra believes the change will result in savings of tens of millions of euros for our members in Europe.
The decision to set a cap on so-called "interchange fees" follows a 20-year campaign by retailers, including EDRA, lobbying the European authorities to take on the might of the international card schemes and European banks. In November 2015 the new rules were applied, and must be respected by all players in the payment cards ecosystem.
However, nothing is ever straightforward when dealing with banks. Our fears are that many will choose not to apply the new fees immediately and wait until they are challenged by the retailer. Others will introduce new, spurious charges on retailers, or they might roll out new types of card, branded as "commercial", which are exempt from the rules.
The decision to set a cap on so-called "interchange fees" follows a 20-year campaign by retailers, including EDRA, lobbying the European authorities to take on the might of the international card schemes and European banks. In November 2015 the new rules were applied, and must be respected by all players in the payment cards ecosystem.
However, nothing is ever straightforward when dealing with banks. Our fears are that many will choose not to apply the new fees immediately and wait until they are challenged by the retailer. Others will introduce new, spurious charges on retailers, or they might roll out new types of card, branded as "commercial", which are exempt from the rules.
Edra is asking retailers to take these immediate steps: 1. Request clarification from your acquirer that the new charges are being applied to your transactions - smaller retailers may wish to request written proof of that. 2. Any new revenue-raising devices are illegal. Challenge your acquirer should they attempt to impose a new charge on you, and if they refuse to remove it, your national competition authority should take action. 3. Find ways to dissuade private customers from using commercial cards in store, maybe by linking this to loyalty schemes.
If you have any difficulties in getting the new rules applied to your business, Edra can help you. We will need to verify who your competent authority is - it could be an independent body or part of the government - and pressurise them to halt the practice. We can also inform the European regulators, who can pressure these same national authorities to take action.
Edra needs to know if you have any concerns over how the new law is being applied, and whether your overall charges are actually going down. The European…
If you have any difficulties in getting the new rules applied to your business, Edra can help you. We will need to verify who your competent authority is - it could be an independent body or part of the government - and pressurise them to halt the practice. We can also inform the European regulators, who can pressure these same national authorities to take action.
Edra needs to know if you have any concerns over how the new law is being applied, and whether your overall charges are actually going down. The European…
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