New EU directive caps cross border fees
Some good news for travel retailers. Credit and debit card transactions costs in Europe are coming down, and just as importantly, become more transparent for merchant and consumer alike. On June 8 EU regulations capping cross border payment fees came into effect.
In a landmark deal, the European Parliament, the Council of Ministers and the European Commission finally endorsed the hard work of the Travel Retail Fair Payment Alliance, which has been pushing for a fairer deal for years.
There are several facets to the new Interchange Fee regulations but for travel retailers the Multilateral Interchange Fee (MIF) is the most important one. MIF is now capped at a maximum 0.2% for debit transactions and 0.3% for credit transactions with immediate effect for cross-border transactions.
Then in December, these limits come into force for domestic transactions, which includes an alternative 0.5 euro cents debit cap which can be applied for smaller payments to cover processing costs.
Aside from capping fees, the Payments Services Directive reform has been passed which sets out very definite policy on aspects such as credit card surcharges. This directive is likely to come into force EU-wide by October this year.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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