Banks planning to steal another £120m from retailers in next big rip-off

And I'm sorry to tell you that this is exactly what has happened.

But this has not been sufficient for the banks and they are now planning their next move to rip-off the retail industry even more. Apparently they don't like Maestro anymore and HBoS has dumped them in favour of Visa so all future debit cards issued by the bank will be Visa rather than MasterCard backed. And HSBC has also announced that it is to do the same, and will undoubtedly be followed by the rest of the herd.

According to the banks the reason for this move is because Maestro debit cards are not accepted everywhere around the world. Pull the other one. The real reason is that in the UK they can make more money from customers holding Visa cards than from those with Maestro cards because the transaction charges to retailers are much higher.

Calculations by Payments Guru (based on numbers from APACS) show that such a move will cost the retail industry at the very least an extra £122 million per year in increased transaction charges. This is based on the fact that Visa debit transactions are typically between 5p and 7p more expensive than those made using Maestro cards.

Retailers might not own Johnsons but they should recognise that they are being taken to the cleaners on this one. We've been banging on about the increases in 'interchange' fees in this column for some time but it seems that nobody is listening.

The old Switch scheme (RIP) is the type of payment card that the EU now wants to be adopted in Europe but MasterCard got there first and with its Maestro card and has enjoyed getting its pound of flesh from retailers with its extortionate charging policies. And now the banks are after another pound of flesh as they start their migration to Visa.

The problem for you retailers is that you won't know about the increased charges from this sly move by the banks until it appears on your statements 12 months from now. But when it does then you'll certainly feel the pain.

The only thing that can protect cardholders in the UK from the blatant and continued conspiratorial activities of these so-called 'honest bankers' is immediate action by the authorities before it is too late.

In these days of electronic communication people power will work so do your part and send a copy of this expose to your MP, local and national consumer bodies, and the watchdog that is watching things on your behalf; the OFT. These groups will then not be able to hide behind the phrase “well we did not know”.

Payments Guru is a monthly-ish column that hopes to get to the heart (and also the guts) of the payments and banking issues that most affect retailers. Whatever the experts in the banking industry tell you, payments guru will seek to put you straight.

With a multitude of years spent in the payments industry working for a number of major financial institutions Payments Guru has in recent years been successfully advising retailers on how best to handle their banks and payments suppliers.

In order to stimulate debate Payments Guru would like to hear any thoughts you might have on his columns so please email him at news@theretailbulletin.com