- Visa has said that it will institute new fees on payments between the EU and the UK after a cap on interchange fees between the two was lifted following of Brexit.
- It is understood that debit card and credit card payments will be affected as well as the costs of online transfers.
- The news came from an unnamed source – though Visa pointed out that it remains a relatively cheap method of placing online money transfers.
Financial services provider Visa has announced that it will be raising fees on cash sent from the UK to the EU – and vice versa – in the coming months.
The financial press is reporting that “unnamed sources” at the firm confirmed that the new rate will kick in later in the year.
It is believed to be expected in October and will affect fees charged for the benefit of banks.
These are known as “interchange fees”.
However, the move will be broader than that.
As well as affecting bank transactions, they will affect online payments and also those placed over the telephone.
There, the fee will rise from 0.3% to 1.5% of the value of the payment.
It will also affect debit card payments going from the UK to the EU by a significant amount.
There, the rise will be from 0.2% to 1.15%.
It comes as interchange fees are no longer bound by a Europe-wide cap.
This change came about as a result of the Brexit vote and subsequent deal between the UK and the EU.
In a statement reported in a newspaper, Visa said that it wanted to meet the needs of lots of different groups of stakeholders.
It added that it was still comparatively cheap as an online money transfer provider.
“As a network we remain focused on balancing the needs of all participants in the ecosystem who each benefit from the ability to use and accept digital payments,” it said.
“Visa continues to be one of the most cost-effective and secure ways to pay and be paid.”
However, a spokesperson for small businesses in parts of the UK took a different perspective on the issue.
Craig Beaumont, who is head of External Affairs for the Federation of Small Business, said that higher card costs could have serious consequences for companies.
“With the move to cashless and eCommerce accelerating, it’s vital that small business and consumer sentiment isn’t stifled by rising card costs, just as we’re trying to bounce back from a severe recession,” he said.
Visa has previously argued that increasing interchange fees may bring wider benefits to business.
It is also believed that Mastercard, which is one of Visa’s biggest rivals on the payments scene, has already instituted fees of this type.
Visa is just one firm among many working in the international money transfers sector – to learn more about the other firms and what they offer, just click here.
