Mastercard to raise fees for UK customers buying from EU because of Brexit

finalfantasist

dazza.mk said:

finalfantasist said:

London7766551 said:

finalfantasist said:

born_again said:

Well we can pass our own regulation restricting their fee to 0%.

Wonder if this will affect banks switch to mastercard?

Isn't it the EU retailers that will be paying this though, rather than UK customers directly?

In that case, it would require an EU directive to be created and implemented to prohibit this charge being applied to transactions with the UK?  Can't really see that happening.

https://www.theguardian.com/money/2021/jan/25/mastercard-to-raise-fees-to-eu-firms-by-500-percent-for-online-sales-to-uk-shoppers

The Financial Times, which first reported the change, said the rise would benefit banks and card providers, rather than Mastercard.
Since 2015, the EU has capped these fees across the European Economic Area (EEA), including within the UK.
Mastercard’s current charges are in line with the cap. The new fees meet a cap for non-EEA cards used for online purchases within the area, which includes Iceland, Liechtenstein and Norway as well as EU countries. The change announced by Mastercard will apply to online sales at shops and businesses based in the EEA that are made on UK-issued cards. Travellers will not face the higher rate on face-to-face sales.
Transactions made by UK cardholders in UK businesses and shops will not face higher rates.

Yes, but it's not a charge levied on your card by your bank, it's presumably a charge levied by Mastercard on the card merchants which is then passed onto the retailers.  None of this happens under UK jurisdiction, so I don't see how the UK Government can pass any law prohibiting this charge, the EU (or EU member states) would need to do this (again as far as I can tell.)

It’s a charge levied on the EU retailers bank and passed (in this case) to the U.K. card issuing bank. There is a current competition enquiry in the EU as to the x 5 charge for Non EU cards compared to EU cards.

It's only passed to the UK bank in the sense that a UK card is being charged, but as far as I can see none of the direct charging will fall under UK jurisdiction so no UK law could forbid it, it would require an EU directive made into law in each member state and I don't realistically see that happening.

There is a small benefit for the EU if they do, it would make their retailers a little more competitive vs the rest of the world for UK consumers, but whether that is more important to them than the obvious desire for them to make Brexit a failure?  Not so sure on that.

Neil49

NoExpertamI said:

The reason the EU was able to ban roaming charges, or higher interchange fees for intra-EU cross border transactions was that it violated Single Market rules by creating boundaries and penalising people unfairly - violating principles of the Single Market. But because the UK is now out, that argument collapses... the UK competition directorate lacks a similar basis for extra-EU transactions.

Can anyone explain how residents of Northern Ireland are impacted by this. In terms of trade they are effectively under the thumb of the EU so should therefore not be subjected to these increased costs.

I'll leave it with Mastercard to sort out the technicalities. 

dazza.mk

finalfantasist said:

It's only passed to the UK bank in the sense that a UK card is being charged, but as far as I can see none of the direct charging will fall under UK jurisdiction so no UK law could forbid it, it would require an EU directive made into law in each member state and I don't realistically see that happening.

There is a small benefit for the EU if they do, it would make their retailers a little more competitive vs the rest of the world for UK consumers, but whether that is more important to them than the obvious desire for them to make Brexit a failure?  Not so sure on that.

Not quite sure I get your comment in the first sentence, the interchange fee is passed to the UK bank as a parallel transaction to the UK card being charged (given it doesn't appear on the statement), but agreed the transaction occurs within the EU so the UK cannot legislate in relation to it (only on EU purchases in UK when UK legislation moves to the same footing).

As to making their retailers slightly more competitive they have just done so, the 1.5% cap is the maximum that was agreed with mastercard in the recent investigation I mentioned (I was incorrect to say it was ongoing), prior to that point they hadn't regulated Non-EEA fees I believe

phillw

London7766551 said:
Does the EEA require free movement of people? I'd suggest this is why it was a no go.

No, it has free movement of workers. Although I thought leave voters weren't racist and it was all about laws and money for the nhs. And yeah, all these job losses, shelves empty in northern Ireland and increased costs are because of brexit no matter how "politically charged" people think it is.

Mastercard wants more money, they can't increase fees within the EU as they've capped them & it seems our government hasn't put a cap in place. So why wouldn't they increase these fees? It was obvious that would happen before the referendum.

phillw

finalfantasist said:
but whether that is more important to them than the obvious desire for them to make Brexit a failure?  Not so sure on that.

It was obviously going to be a failure, nobody has to try to make it one.

London7766551

phillw said:

London7766551 said:
Does the EEA require free movement of people? I'd suggest this is why it was a no go.

No, it has free movement of workers. Although I thought leave voters weren't racist and it was all about laws and money for the nhs. And yeah, all these job losses, shelves empty in northern Ireland and increased costs are because of brexit no matter how "politically charged" people think it is.

Mastercard wants more money, they can't increase fees within the EU as they've capped them & it seems our government hasn't put a cap in place. So why wouldn't they increase these fees? It was obvious that would happen before the referendum.

You obviously have not bothered to read the thread. But I don't want to start the argument again. The remainers never seem to understand that people were prepared to vote leave even if that meant a financial impact. But they considered the impact would be manageable. SO far they have been proven right for the population as a whole.

I am not really concerned with this act by Mastercard, we had these fees only five years ago and they are now coming back, hardly anyone will notice and to suggest it is going to cause issues is somewhat fear mongering. We should now expect Mastercard to decrease fees elsewhere, and if they do not the authorities will need to look as ways to make them. Other fees were increased in 2015 due to this EU regulation. If you have been reading the thread you would know it is not possible or not very easy for the UK to introduce such a cap as you suggest.

Roger1

dazza.mk said:

Switzerland is a member of EFTA ...

Switzerland is NOT a member of EFTA!

London7766551

phillw said:

finalfantasist said:
but whether that is more important to them than the obvious desire for them to make Brexit a failure?  Not so sure on that.

It was obviously going to be a failure, nobody has to try to make it one.

If you can define what such a "failure" is that would be useful. So far the vast number of dire predictions that were made in June 2016 about what would happen if we voted leave have failed to materialise. Teething problems with paperwork, fish, VAT etc are certainly occurring. But these are short term. So far we have yet to really see any core consequence for the average UK citizen and the UK as a whole. For the most part, things are pretty stable. All of these media etc who made these predictions now feel a bit silly and are scraping the barrel to find consequences of merit. One example was today where there was an article who had to pay VAT on a pair of earrings from Greece........

At the end of the day being a member of the EU is simply agreeing to follow a set of rules and in return the flow between club members is smoother. If a member of such a club wants to go a different way and can't get the club to change, then they should leave. That is common sense. In any other scenario nobody would really become so emotional. Britain was never a happy member. It is no surprise that a vote on membership came up again and we voted to leave the club. Sure some lies might have been told about what the benefits would be, but the constant suggestions that this somehow was responsible for the actual vote outcome doesn't really hold up. Brexit is done and dusted, right or wrong, it doesn't matter if people agree or not. In the world of adults, we had a vote, and an election, and decided to leave a club. I voted to leave, I am not racist, I do not dislike EU people, I still want them to come here, I still want to go to the EU on Holiday, I still want to be friendly with the EU. I am happy there is a trade deal and that the UK and EU have agreed the rules of trade like any other country. I just don't want to be a member of it and I am prepared to accept the consequences on my life. The majority also decided this, in a democracy that is how it works. Every time we have an election the same choices are made. Every election will impact somebody, every political choice has bad and good outcomes. We were always sensible in the past.

Somehow in 2016, people became like spoilt children who didn't get their way to decided to cry and whine. We are all supposed to be adults, sometimes you don't get what you want in life. It is OK to moan about it, but what we had over the last four years was hysterics. The bizarre fact that the whole Brexit debate was reduced to such a spectacle of hate (on both sides) will intrigue historians for centuries. In the years gone by, people would accept your political beliefs and carry on with life. When Labour or the Tories got in, people would have a moan, and get on with life. They would not attack indiividial people on how they chose to vote. They certainly would not support ignoring the vote or suggesting the voters had no clue what they were doing. But for the past four years that is what we had. And now nobody seems to be able to think sensibly and be respectable. It is all digs and insults and being p*ssy with each other. Even this Mastercard decision should have been a simple and sensible thread, but from the very first post it was loaded. We will have to put up with this for another five years at least, perhaps for a generation. I think the argument for me is done. I am going to get on with life and I suggest others do as well.

dazza.mk

Roger1 said:

dazza.mk said:

Switzerland is a member of EFTA ...

Switzerland is NOT a member of EFTA!

Sorry Roger, you are wrong......

https://www.efta.int/about-efta/european-free-trade-association

dazza.mk

phillw said:

London7766551 said:
Does the EEA require free movement of people? I'd suggest this is why it was a no go.

No, it has free movement of workers. Although I thought leave voters weren't racist and it was all about laws and money for the nhs. And yeah, all these job losses, shelves empty in northern Ireland and increased costs are because of brexit no matter how "politically charged" people think it is.

Mastercard wants more money, they can't increase fees within the EU as they've capped them & it seems our government hasn't put a cap in place. So why wouldn't they increase these fees? It was obvious that would happen before the referendum.

Incorrect it has free movement of people rather than just free movement of workers see EFTA below so a broader EEA view rather than just EU

And Mastercard are increasing fees in the EU rather than in the UK as they are fees paid by EU merchant who accept online transactions from UK cards (cards in person are subject to the same EU cap due to previous assurances given by Mastercard to the Commission)

https://www.efta.int/eea/policy-areas/persons