Cross Border Acquiring rules brought in across the EU last year have led to a price war among acquirers, driving down transaction costs for merchants savvy enough to demand reductions from January 2015.
As cash treasury management expert Jack Large explains, the regulation undercuts existing MSCs by allowing cross-border acquirers that have regulated operations outside a country to bid for domestic merchants using the 0.2% and 0.3% interchange. As a result, many merchant acquirers have responded by setting up regulated operations outside their home country, sparking a price war.
For companies subject to high transaction fees, the potential rewards are significant. The payment and technology consultants PSE Consulting estimate that an organisation processing €15m of payments across Europe could stand to save over €72,000 per year in fees.
Of course, acquirers are far less thrilled by the increase in price competition – and the dwindling margins that will result. According to PSE Consulting: “the concessions have generated the most disruptive challenge Europe’s acquirers have ever addressed. Even worse, they apply from the 1st January 2015, twelve to 30 months ahead of the application of the EC’s proposed CBA Regulation. High credit card interchange countries such as the UK, Germany, Portugal and Sweden are very vulnerable and are most threatened by major reductions in interchange revenues.”
According to Large, merchants have already begun asking their acquirers for substantial reductions, effective as of January next year.
The problematic US EMV rollout and the larger question: Is EMV actually protecting retailers against fraud?
In this guest post, Vlad Branin, VP, Professional Services, Zooz, talks about the ins and outs of US EMV adoption: process of rolling out and the specific benefits.
New data from Worldpay, which surveyed 4,000 shoppers in Europe, shows the continent is becoming more tech-savvy and a keen adopter of new payment technology.
Berlin neo bank N26 talks new products, UK launch and the advantages of being based in Berlin.
Just under twenty percent of all card purchases are now being made on contactless cards, according to new data from the UK Cards Association.