An update on interchange fees between the UK and EEA

As of January 2021, the United Kingdom broke away from its long standing relationship with its closet neighbour and is therefore no longer part of the EEA.

As a result, Mastercard and Visa have announced revisions to interchange fees applicable between the UK and the EEA. These changes came into effect in October 2021.

Mastercard revises interchange fees

As a result of Brexit, Mastercard revised the interchange fees for transactions between the UK and EEA. The revised interchange fees became effective as of October 15^th 2021.

The revised interchange fees will especially have a significant impact on consumer card-not-present transactions from UK-issued cards at EEA merchants.

Consumer card-not-present transactions between the UK and EEA countries are currently charged 0.20% for debit cards and 0.30% for credit cards.

Due to the revised interchange, these transactions will be charged in line with the interregional capped consumer rates of 1.15% for debit cards and 1.50% for credit cards.

Note that for Mastercard, the new rates will apply unilaterally for consumer card-not-present transactions from UK-issued cards at EEA-merchant locations.

The consumer card-not-present interchange rates for EEA-issued cards at UK-merchant locations will remain unchanged.

Visa announce interchange fees updates300

Visa has announced similar changes to Mastercard, but with a larger scope. More specifically, the Visa changes will have significant impact on consumer card-not-present transactions, consumer refund transactions, and commercial transactions between the UK and the EEA. The announced changes became effective on October 16^th 2021.

Consumer card-not-present transactions between the UK and EEA countries are currently charged 0.20% for debit cards and 0.30% for credit cards.

With the recent announcement from Visa, these transactions will be charged in line with the interregional capped rates of 1.15% for consumer debit cards and 1.50% for consumer credit cards.

The interchange rates for consumer card-present transactions between the UK and EEA countries will remain unchanged.

Furthermore, the interchange rates for Business cards will be set at 1.60% while Corporate and Purchasing cards are revised to 1.80%.

In contrast to Mastercard, Visa will apply the updated interchange fee rates bilaterally. This implies that both transactions with UK-issued cards at EEA merchants and EEA-issued cards at UK merchants will receive the updated interchange rates.

Since October 19^th 2019, Visa has removed the returned interchange for interregional refunds in the EEA (more information can be found here).

As of October 16^th 2021, interchange will no longer be returned for consumer refund transactions between the UK and the EEA both for card-present and card-not-present.

This change will also be applied bilaterally. Interchange rates for commercial cards will remain unchanged.