As your payments partner, we are committed to keeping you up-to-date with industry and card scheme developments. The purpose of this communication is to advise you of new pricing changes being introduced by Visa and Mastercard.
- Visa and Mastercard are decreasing the inter-regional interchange rates for transactions on consumer cards issued outside of the European Economic Area (EEA) occurring at merchants located in the EEA. Visa refunds will not be charged any interchange. Effective date 19th October 2019 (see table below, please).
1 European Economic Area (EEA) Consists of the 28 EU Member States plus Iceland, Liechtenstein and Norway This includes the French European Union Outermost Region territories of Guadeloupe, French Guiana, Martinique, Mayotte, Reunion and Saint-Martin.
* Consumer Debit Includes debit, immediate debit and prepaid.
* Consumer Credit Includes credit, deferred debit and charge.
2 In the context of the Interchange changes arising from the Mastercard Commitments to the European Commission, “card present” means card/cardholder present having valid card entry mode transactions, and “card-not-present” other transactions in the Commitments scope.
3 Card-present transactions are where (i) cardholder and card are present at either the merchant outlet or are with the merchant’s physical POS device at the time of payment transaction, and (ii) the cardholder’s issuer-provisioned payment credentials are present and electronically read by the merchant’s physical POS device.
4 Card-not-present transactions are all transactions other than card-present transactions.
Furthermore Mastercard and Visa have advised all acquirers that the transaction processing pricing will be revised as follows:
A) Interchange Fees
- Mastercard is changing interchange fees on inter-regional refunds/returns from non-EEA merchants - effective date 18th October 2019.
- Mastercard is changing the Commercial Refund Interchange Fees in the Europe Region – effective date 12th July 2019. Nevertheless, the new calculation method will only be automated in Elavon and Mastercard systems from the 18th of October. Please expect a billing adjustment regarding impacted refunds occurring from 12th July 2019 to 18th of October 2019. The billing adjustment will be, most probably, a credit.
- Mastercard is deprecating tiers allowing lower interchange fees on inter-regional commercial purchasing high value transactions (IRDs 62 and 67) - effective date 18th October 2019.
- Visa is revising the Intra-Europe EEA and Non-EEA Business Prepaid Interchange Rates – effective date 9th November 2019.
- Visa Domestic Business Immediate Debit and Prepaid Interchange Fees will be updated in the UK, effective 17th August 2019
B) Assessment Fees
- Annual review and update of Visa, Mastercard and Maestro Assessments including volume, transactions and Clearing & Settlement, other fees and Foreign Exchange (FX), effective 1st October 2019.
- Europe Acquirer Card-Present (will vary by merchant country) and Card-Not-Present (Visa Debit 2.8 basis points and Visa Credit 3.3 basis points) service fees will be modified effective 25th January 2020.
- Visa is introducing a new fee of 0.02 € per transaction for Verified by Visa 3DS 1.0 and 2.0 transactions – effective date 1st September 2019.
- Mastercard are renaming the old non EMV/Chip, non-contactless fee to the Mastercard Chip and Contactless Enablement Acquirer Fee. They are also introducing the fee into new countries, changing rates and changing the logic of when it will apply across some European countries – div. effective dates July - December 2019
- Visa is revising the International Acquirer Fee (IAF) for their non-EU rates (relating to enhanced only: “International POS transactions conducted in a currency other than the official currency of the merchant country”) from 0.65% to 0.95% - effective 01st May 2019.
What will these changes mean for you?
The result of these changes being introduced by Visa and Mastercard may be a net increase in fees payable to the schemes and a decrease of interchange fees. The changes outlined are the only amendments to your existing fee/pricing structure.
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