Visa's fee rise risks higher shop prices
Visa's plans to hike its card charges could add around Â£20 million to UK retailers' costs at a time when they can least afford it. This will ultimately force up shop prices.
The British Retail Consortium (BRC) is calling on Visa to justify its charges as today (Thursday) its ‘card scheme fees' increase by as much as 142 per cent. These are the non-negotiable charges paid by retailers' banks and card processors to Visa to be part of its card network. These costs will inevitably be passed onto retailers.
Another charge used by Visa – the interchange fee – is currently being investigated by the European Commission and the Office of Fair Trading. The BRC fears, with possible regulatory restrictions on interchange fees, that Visa is looking for huge increases in its other charges to compensate for any loss of revenues. Stephen Robertson, BRC Director General, said: "Visa's card scheme fees hike is totally unjustified. At a time when technological advances have dramatically reduced the cost of processing card transactions, we'd expect card charges to fall – not shoot up.
"Retailers are already dealing with tough trading conditions and shoppers are also watching the pennies. As Visa ramps up its fees it will hit retailers at a time when they can least afford it, while pushing up shop prices and hurting cost conscious customers.
"Visa's fees should be transparent and must only include charges that truly reflect the costs involved in processing transactions."
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