LONDON, Jan. 13 () – British lawmakers are planning to investigate whether business Visa and Mastercard fees have been increased after the country’s fee regulator found no evidence to justify growth, a parliamentary committee said on Thursday. .
The Parliamentary Selection Committee for the Treasury said companies whose networks accounted for 99 per cent of card transactions in the UK had increased the scheme and exchange fees paid by businesses to card issuers when they used the card.
“Given that Visa and Mastercard currently dominate the industry, it is important to ensure that there is adequate regulation and competition in the market so that businesses do not face ever-increasing service costs,” said committee chairman Mel Stride. statement.
Mastercard and Visa did not immediately comment.
Businesses pay scheme fees and exchange fees based on individual transactions to be part of a payment network. Regulators say the increase in fees that merchants pay to card issuers is usually passed on to consumers.
The British Payment Regulatory Authority (PSR) said in November that card services were not working well for small businesses.
In a letter to Stride on Thursday, he said he would propose “treatment options” this month to address the rising scheme fees, which doubled between 2014 and 2018.
“Our analysis shows that a significant proportion of these increases are not explained by changes in the volume, value, or mix of transactions,” PSR said. “Our ongoing relationships with traders are a testament to the fact that they have continued to grow significantly since then.”
Amazon.com said in November that it would stop accepting Visa credit cards from the UK in mid-January due to an increase.
Following the end of the EU border due to the full withdrawal of the UK from the bloc by the end of 2020, exchange fees for British consumers’ purchases from the EU increased last year. However, in the UK, purchasing fees remain limited under UK rules.
PSR said it was closely monitoring the increase in cross-border exchange fees by Visa and Mastercard in October, and said there had been no significant changes in costs for issuers.
“The work we are proposing will take a closer look at the reasons behind the recent growth and whether it highlights any issues or concerns that require us to take action,” he said.
Stride said the Treasury Committee will discuss the regulator’s plans at a hearing in March.
Efforts to end domination in the EU and Mastercard have led to mixed results here.
Hugh Jones’s interview; Edited by David Clark