Britain's Payment Systems Regulator (PSR) on Wednesday provisionally proposed capping cross-border interchange fees charged by Mastercard and Visa for transactions between the UK and the European single market. Under the proposal, the PSR would impose initial time-limited caps of 0.2% and 0.3% on UK-EEA debit card transactions and credit card transactions respectively. After further analysis, a persistent cap will be implemented.
PSR said the review focused on fees set by Mastercard and Visa as they account for 99% of UK debit and credit card payments. The two companies may have raised their charges to "excessive levels", costing British businesses an additional £150 million to £200 million due to increased charges.
A Visa spokesperson said the company strongly disputes the findings of the PSR interim report and called the proposed remedies "unreasonable."