Regulator sets out proposals to cap cross-border interchange fees charged by Mastercard and Visa

Britain’s payment regulator has set out proposals to cap cross-border interchange fees charged by Mastercard and Visa after raising concerns that they have been hiked to “an unduly high level”.
Greg Wright
By Greg Wright
Published 13th Dec 2023, 09:18 BST

The Payment Systems Regulator (PSR) said a cap would protect UK business from overpaying on fees charged on transactions made between the UK and European single market. It said UK firms paid an extra £150m to £200m last year alone due to significant fee increases pushed through by the card firms in 2021 and 2022.

The PSR said its interim findings of a market review on interchange fees charged since Brexit, when the European Union’s rules on payments stopped applying to the UK, suggest that the market is “not working well”

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Chris Hemsley, managing director at the Payment Systems Regulator, said: “In this market review we have provisionally found that the fees charged by Mastercard and Visa to UK businesses which accept payments from within the European Economic Area are likely too high.

Britain’s payment regulator has set out proposals to cap cross-border interchange fees charged by Mastercard and Visa after raising concerns that they have been hiked to “an unduly high level”.(Photo by Dominic Lipinski/PA Wire)Britain’s payment regulator has set out proposals to cap cross-border interchange fees charged by Mastercard and Visa after raising concerns that they have been hiked to “an unduly high level”.(Photo by Dominic Lipinski/PA Wire)
Britain’s payment regulator has set out proposals to cap cross-border interchange fees charged by Mastercard and Visa after raising concerns that they have been hiked to “an unduly high level”.(Photo by Dominic Lipinski/PA Wire)

“In short, at this stage, we do not think this market is working well.

“Should we ultimately conclude this is the case, our interim report sets out a range of potential solutions which could be implemented.

“They are designed to make sure cross-border interchange fees are set at a level that better reflects the interests of all Mastercard and Visa users.”

Related topics:MastercardEuropean UnionBrexit