Are scheme fees covered by the EU interchange caps?
No. The Interchange Fee Regulation caps consumer interchange at 0.2 percent for debit and 0.3 percent for credit, but scheme fees sit outside those caps. That is why operators benefit from reading interchange, scheme fees and markup itemized per transaction, and why scheme fees have drawn regulatory scrutiny in the UK and requests from European retailers.
In detail
No. The Interchange Fee Regulation caps consumer interchange at 0.2 percent for debit and 0.3 percent for credit, but scheme fees sit outside those caps. That is why operators benefit from reading interchange, scheme fees and markup itemized per transaction, and why scheme fees have drawn regulatory scrutiny in the UK and requests from European retailers.
What the caps cover
The Interchange Fee Regulation of 2015 caps the interchange paid to the card issuer on consumer cards: 0.2% for debit and 0.3% for credit within the European Economic Area. Interchange is only one of three parts of a card fee. The other two, scheme fees paid to Visa or Mastercard and the acquirer's markup, are not capped.
What happened next
- The European Commission's review found scheme fees had increased, to a limited extent, after the caps.
- The UK Payment Systems Regulator opened a market review of scheme and processing fees.
- European retailer associations have asked for scheme fees to be regulated or made transparent.
What operators can do now
Read fees itemized per transaction: interchange, scheme fee, markup. Acquirers that only provide a blended rate hide where the cost grows. With itemized data reconciled against each transaction, an operator can show merchants their real cost, negotiate markups with evidence, and route transactions where the total is lowest. The caps protect one line of the invoice; the operator's reporting has to watch the other two.