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Retailers, Consumers Need More Competition In Payments: EuroCommerce

By Steve Wynne-Jones
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Retailers, Consumers Need More Competition In Payments: EuroCommerce

The COVID-19 pandemic has accelerated the move towards online transactions, however unregulated fee increases threaten to impact retailers and manufacturers seeking to take advantage of this channel, EuroCommerce has said.

Commenting following a European Commission communication on a Retail Payments Strategy for the EU, EuroCommerce Director-General Christian Verschueren said, "Retailers and other merchants already pay a lot for accepting [credit and debit] cards, and even more if a transaction is online.

"We are seeing, despite very welcome action on some card fees under EU legislation, other unregulated fees rising as much as 150% over the last 18 months. This has cost merchants, already struggling due to COVID, nearly €1 billion extra, and this trend looks likely to continue.

"We therefore welcome the Commission commitment to promote alternative payment systems. But these will take at least another two to four years to roll out, and merchants need urgent action now to address this growing problem.”

Retail Payments Strategy

EuroCommerce said that the development of the Retail Payments Strategy is a welcome step, as well as the recently-announced collaboration between European banks in the European Payments Initiative.


Efforts to encourage competition in retail payments, including the development of new applications for mobile payments, are also a positive sign, the group added.

"We regret, however, while we wait for new alternative systems, the Commission’s decision not to use the review of the Interchange Fee Regulation (IFR), to widen its scope to deal with the ongoing rise in unregulated fees, particularly card scheme fees," said Verschueren.

"Recent evidence suggests that these (and other fee increases) may cancel out much of the benefit of the regulation. This situation further strengthens the position of the two US card schemes, whose market power has been a contributory factor in the failure of at least four earlier EU initiatives. This could happen again, and, as we saw in other markets with powerful incumbents, regulation may be the only way to allow new competitors to grow."

© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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