Crackdown on card fee fixing

The bosses of 14 major retail companies have signed a letter to the European Commission calling for a crackdown on the excessive charges that make Europe’s payment card companies 13 billion euros a year in revenue.

The retailers, who together have 250 million customers a week and include Asda/Walmart, IKEA, Kingfisher, M&S and Tesco, say the EC must order cuts in the fees card companies charge retailers for each transaction when it makes its long-awaited ruling on the legality of the so-called ‘interchange fees’.

The retail chiefs say the success of the Single Euro Payments Area (SEPA), to be launched in January 2008 and intended to create a Europe-wide system for efficient, low-cost money transfers between EU countries, depends on the EC taking action to end MasterCard and Visa’s price fixing.

Their letter argues if SEPA is launched with card companies allowed to continue the existing secretive and excessive charging regime it could fail because the potential benefits to customers and businesses will be lost.

The British Retail Consortium has led the fight against the charges and long argued that they are an unjustifiable tax on customers.

Says BRC director general, Kevin Hawkins: “The commission’s decision on these cross-border card charges has huge implications for individuals and businesses throughout Europe. MasterCard has clearly been abusing its position to boost profits at massive cost to customers and retailers.

“The commission claims its Single Euro Payments Area will do for card payments what the euro has done for cash, but it will only deliver the cheap, easy system promised if MasterCard and Visa’s price fixing is ended.

“Retailers big and small are simply looking for a fair deal. With the new area starting in less than two months, the commission must recognise now is the time.”

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button