The EU has imposed a limit on how much card companies can charge retailers to use electronic payment systems. The UK Treasury says the cap is designed to push prices down for consumers, skynews.com reports.
When shoppers in the UK use debit or credit cards, a percentage of the purchase price is paid by the retailer to the card company. As of the iomplementation date of teh new regulation, fees on credit card transactions will be capped at 0.30%, below the average of 0.85%.
Debit card fees will be limited to 0.20% of the transaction value. The current average is about 0.21%. According to the European Commission, interchange fees amount to GBP 1 billion per year in the UK, although some estimates are double that figure. But there is concern that card companies will recoup their costs in other ways.
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