20 December 2007
The EU has demanded that credit card suppliers must cut the fees that they charge retailers for their authorisation services - a move which could result in significant price savings for consumers.
Currently, the fees situation in the UK - which sees some major store chains paying a nine-figure annual sum to credit card firms for their processing of transactions - is being investigated by the Office of Fair Trading (OFT).
The ruling was made by the European Commission in their upholding of a case brought against Mastercard for its fees - and the body indicated that rivals Visa will also soon be investigated.
Under the terms of the commission's verdict, card providers are to be fined if they do not amend their retailer fees within six months.
Competition Commissioner for the EU Neelie Kroes, delivering the ruling yesterday, said: "Consumers foot the bill, as they risk paying twice for payment cards: once through annual fees to their bank and a second time through inflated retail prices paid not only by card users but also by customers paying cash."
She termed the verdict "an early Christmas present for consumers".
The OFT is expected to take the EU ruling when making its decision on the fees next year.
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