The European Commission’s Dec. 8 decision to accept Visa Europe’s commitment to cap a certain debit card interchange rate will do little to remove the burden of interchange fees from Europe’s merchants and consumers, EuroCommerce contends.
Instead, EuroCommerce, which represents the retail, wholesale and international trade sectors in Europe, believes the settlement will enable well-established international brands such as Visa and MasterCard Worldwide to become even more powerful.
Visa Europe has agreed to cap its weighted yearly average intraregional multilateral interchange rate for immediate debit transactions at 0.2% of the sale for four years (
EuroCommerce also contends the Single Euro Payments Area will put an end to “cheap, efficient national debit cards schemes,” the organization noted in a news release. Subsequently, issuing banks no longer will work with card companies that offer lower fees, the organization says.
“The commission may need to rethink its strategy on multilateral interchange fees to prevent the establishment of a SEPA card market permanently riddled with anticompetitive problems,” EuroCommerce Secretary General Xavier Durieu said in the release.
SEPA is an initiative the European banking industry launched in 2002 to link European Union and other euro-based countries’ separate national payment systems into a standardized debit system usable for cross-border debit transactions. Various attempts to create a pan-European card network have been exercised, but none has yet gained sufficient momentum to compete with existing international brands already usable across countries’ borders (
What do you think about this? Send us your feedback.
