- A technical notice just highlighted the implications of the absence of a Brexit deal for those who send cross-border payments regularly
- Cross-border payments won’t be covered by the surcharging ban in a “no-deal” scenario, according to officials
- UK government is looking into a general transitional tool to minimise disruption
The absence of a Brexit deal and its implications for British businesses was highlighted in a technical notice published by the British government on Thursday.
While discussing the consequences of a “no-deal” scenario, the notice on banking, insurance and other financial services said: “The cost of card payments between the UK and EU will likely increase, and these cross-border payments will no longer be covered by the surcharging ban.”
According to the government, this will prevent businesses in the country from charging consumers who use specific payment options. Aside from this, the cost of euro transactions is likely going to increase as well.
Although the British government has a contingency plan, a Reuters report notes that the government will do what it can to take unilateral action to minimise disruption in the UK’s finance sector and ensure that businesses in the country do not suffer.
Experts add that the European Union also needs to help avoid any interruption in the country’s cross-border financial services.
The notice states: “The UK is a major centre for investment banking in Europe. In the absence of EU action, European Economic Area clients will no longer be able to use the services of UK-based investment banks.”
The UK government is firm on its stand, but Brussels has said that it is the responsibility of banks and other financial institutions to formulate contingency plans before Britain’s exit from the European Union.
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