|
|
Banks’ card payment fees cost EU retailers over €10 billion each year, according to European Commission figures. These fees are not clear to card users. They also differ between EU member states, because they are fixed not by law but by national competition authorities. Retailers are charged for every card transaction and add the costs to the prices of goods or services they sell.
The service or "interchange" fees that banks charge for processing transactions under schemes such as Visa and MasterCard, would be capped at 0.3 per cent of the transaction value for credit card transactions and 7 euro cents, or 0.2 per cent of the transaction value (whichever is lower), for debit card ones.
These caps would apply to both cross-border and domestic transactions in the EU and would take effect one year after the rules enter into force. In time, lower fees should translate into lower prices for card users.
Online payment security rules would be updated to keep pace with technical progress, market developments and the constantly growing number of payments made online. Online payment service users would also get a uniform set of information for example all charges, execution times, contact information and where applicable exchange rates, would have to be clearly stated.
Unauthorised payments would have to be refunded within 24 hours of their being noticed and clients could be obliged to bear losses resulting from the illegal use of a lost or stolen payment card or device up to a maximum of €50.
Payment service providers would be required to disclose the actual cost of processing payments on request. Moreover, caps for payment service charges should be laid down in forthcoming EU rules on card payments and should apply regardless of the specific payment device or means of execution.
Next steps
The European Parliament voted on its amendments to the draft rules in order to consolidate the work done so far and hand it over to the next Parliament. This ensures that the MEPs newly elected in May can decide not to start from scratch, but instead build on work done during the current term.
EBF
The EBF has supported the revision of the directive because banks believe this can promote better integration, encourage innovation and boost competition in the market for payment services in the EU. However, the EBF has identified some important areas of concern and reiterates the need for further specific improvements.
"Banks believe it is important to update the existing directive because payment technologies continue to evolve rapidly and more competitors are emerging on the market", said Guido Ravoet, Chief Executive of the EBF. "But it is also clear that these improvements need to be appropriate and make the services more secure. Their impact needs to be carefully considered. We believe there is still a lot of work to be done and urge the Council to take this into account."
Some aspects on access to consumer on-line accounts by third-party providers remain to be addressed. The proposal that the parliament has endorsed allows third-party providers to access personal security credentials of consumers. As a result, the final outcome is an unclear legal framework without certainty about the rights and obligations of users, third-party providers and payment service providers.
European banks had also urged lawmakers to exclude commercial payment cards from interchange fee caps. The inclusion of these cards risks creating substantial, unintended negative consequences for businesses across Europe. Commercial and consumer cards represent two separate markets. Applying this cap also to commercial cards creates uncertainty for large and small businesses.