From October 15, Mastercard will charge 1.5 per cent of the transaction value for every online credit card payment from the UK to the EU, up from 0.3 per cent at the moment. For debit card payments, the fee will jump from 0.2 per cent to 1.15 per cent. The increase will benefit British banks and other card issuers, rather than Mastercard itself.
I can’t read the article but judging by the headline I’m assuming transactions within the UK is still 0.3%? If so I assume they’re only (wisely) delaying it as increasing fees for a struggling industry wouldn’t be a great look.
If they increase fees on transactions within the UK we could probably see a return to how it was before the EU directive was introduced, which was ‘better’ than it is now but not comparable to the US.
Since it only applies to UK->EU/EEA transactions, more likely you’ll see cards offering increased rewards for international spend, which already happens in some Asian countries. Two examples: the Japanese Delta AmEx Gold offers 1.5x bonus earnings for spend outside Japan, and the HSBC Singapore Visa Infinite earns 2x for international spend.
I did have issues in Germany a couple years ago where one or two places point blank said they did not take UK cards. I forced one to let me try and it was rejected (whether he did something on his till or it was genuinely set up that way). Never got to the bottom of it but was very odd.
Well, it is about cross border payments. At the moment all Revolut cards in Europe are issued by the UK entity rather than the EU (Lithuanian or Irish) entity. Meaning potentially all of Revolut cards are affected too.
But for example, if Revolut keeps UK customers in the UK entity card issuer, and moves EU customers to a EU entity card issuer then only cross border payment will be affected. I.e. EU card buying things in the UK; and UK card buying things in the EU.
That’s if acquirers passed on the saving from the caps. With how many places take uncapped interchange amex cards it must make little to no difference, I just want to get free stuff from buying things I’d buy anyway without paying interest.