Mastercard says shoppers won’t be hit by fee hike
Mastercard has insisted that UK shoppers buying goods from the EU on a credit card will not be impacted despite a hike post-Brexit fees between merchants.
The company has announced that from 15 October it will impose a fivefold increase in “interchange” fees which it collects on behalf of banks on each transaction.
The interchange fee covers the costs of things like fraud prevention and systems maintenance to keep its card payment network running smoothly.
Kevin Hollinrake, chairman of the all-party parliamentary group Fair Business Banking, told the Financial Times: “This smacks of opportunism and I would urge the regulators to step in as a matter of urgency to ensure that financial institutions do not use Brexit as an opportunity to hike up costs that consumers will ultimately bear.”
The SNP leapt on the announcement as further evidence that UK consumers and businesses will be hit with more charges as a result of Boris Johnson’s “hard Brexit” deal.
However, the Coalition for a Digital Economy’s head of policy Joel Gladwin dismissed such conclusions.
“Some people might put this change down to Brexit, but it is actually just greed,” he said. “It is well within the power of the card schemes to make merchants’ lives easy and keep things operating as they were pre-2021.”
Mastercard said the changes were in line with levels it had agreed with the European Commission for transactions from all non-member areas in 2019.
It said: “In practice, only EEA merchants making e-commerce sales to UK cardholders will see a change.”
A Mastercard spokesman told Yahoo Finance: “We want to be very clear, UK shoppers will not face any new fees as a result of this change.”