Brussels, 10/11/2014 (Agence Europe) - The member states reached a political agreement in principle setting the level of the multilateral interchange fees (MIF) for debit and credit card payments, at a meeting of the ambassadors to the EU on Wednesday 5 November.
The Council of the EU wants to limit MIF to 0.2% for cross-border debit card payments. For purely national debit card transactions, the member states must ensure that: - the MIF observes the limit laid down the cross-border payments, or; - the service providers apply an average weighted MIF not exceeding 0.2% of the average annual value of transactions made in the framework of a specific payment regime. This average annual value of transactions will be calculated on the basis of a calendar year and will apply from 1 April of the following year.
For cross-border credit card payments, the member states will set the level of the MIF at 0.3%. If they wish, they can set a lower level for credit card transactions made on a purely national basis.
The Council states that these provisions will apply six months after the entry into force of the regulation.
The member states' agreement paves the way for the launch of inter-institutional negotiations with the European Parliament, which took position on this dossier in February (EUROPE 11023). Adopting the European Commission's proposal, the MEPs set the MIF level for credit card payments at 0.3% of the transaction amount. For debit card payments, on the other hand, the MIF would be limited to either 7 euro cents or 0.2% of the transaction amount, whichever is the lower. According to the EP, these limits would apply one year after the legislation enters into force, for both cross-border and national transactions.
Multilateral interchange fees are paid by the bank of a trader to the bank of the holder of the payment card used for the transaction. Permitted in some member states at a variety of different maximum levels, they are banned elsewhere. The Commission argues that they lead to excessive revenue for Mastercard and Visa networks and are ultimately passed on in the prices of the goods purchased by the consumer. (MB)