Big changes have recently been implemented that will benefit both merchants and consumers in the EU. A statement released by Merchants Payments Coalition, an international organization representing retailers, supermarkets, drug stores, gas stations and online merchants announced a reduction in “swipe fees” paid to banks and credit card companies. These swipe fees increase the cost of doing business for merchants, thereby increasing the cost to consumers for everything from groceries to gasoline, so this news is sure to have a positive impact on the EU market.
The change was put into effect after 28 countries of the European Union concluded that Visa, MasterCard and their banks were gouging consumers and merchants. The new rules include setting a maximum swipe fee of 0.2% on debit cards and 0.3% on credit cards.
By comparison, fees are currently up to a dozen times higher in the U.S. As an example, a bank might charge a grocery store $4 on a $100 purchase of groceries if the consumer pays via credit card. After this ruling in Europe, that same transaction would cost the store just 30 cents.
With this landmark ruling in the EU comes hope that U.S. policymakers will reevaluate these inordinate fees. After all, the U.S. currently has the highest swipe fees in the industrialized world.