Helena Lyng Blak
3 weeks ago

Mastercard and Visa Under Scrutiny

UK regulators find that the payment card market is “not working well”.
Banking payment cards Visa and Mastercard — Photo by Vicdemi
Banking payment cards Visa and Mastercard — Photo by Vicdemi

On Tuesday, May 21, 2024, the United Kingdom Payment Systems Regulator (PSR) published an interim report for its market review into scheme and processing fees, suggesting that the supply of scheme and processing services in the country is not “working well.” 

The PSR specifically named payment card juggernauts Mastercard and Visa in its report, saying that the duo faces no effective competition to prevent the two businesses from hiking fees unnecessarily.

According to the PSR, Mastercard and Visa have increased their fees by more than 30% in real terms over the last five years, with little to no evidence of improvement in services that may explain such price surges. 

“Every time someone uses a Mastercard or Visa card, UK businesses have to pay fees. These fees have significantly increased over recent years, and those increases cannot be explained by improvement in service quality,” said Chris Hemsley, Managing Director of the PSR. 

The PSR further highlighted troubles surrounding the lack of transparency of and option to negotiate prices, with Hemsley stating,

“We have also identified concerns about the transparency and quality of information available to those providing card services to businesses. Competition does not appear to be protecting businesses effectively.”

Moving forward, the PSR will be seeking feedback on its interim report until the end of July, after which the regulators will publish a final report. Should the final report uphold these provisional findings, the PSR may implement remedial measures. 

The remedies may include steps to ensure improved transparency and obligations on Mastercard and Visa to explain or consult on the reasons for price changes.  


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