Do EU interchange caps limit the full cost of a card payment?

Only part of it. The Interchange Fee Regulation caps consumer interchange at 0.2% for debit cards and 0.3% for credit cards. Scheme fees and the acquirer's margin sit outside those caps, and the European Commission found that scheme fees had increased, to a limited extent, after the caps came in. The full cost depends on every layer of the contract.

Three parts to a card fee

Interchange goes to the issuing bank. Scheme fees go to Visa or Mastercard. The markup goes to the acquirer. The EU Interchange Fee Regulation caps only the first, at 0.2% for consumer debit and 0.3% for consumer credit cards. Commercial cards and cards issued outside the EEA are not capped.

What moved after the caps

• The European Commission's 2020 review found scheme fees had increased, to a limited extent, since the caps.
• Acquirer markups vary widely and are rarely itemized for small merchants.
• Blended pricing hides which part of the cost went up.

What to do

Treat the cap as a floor for understanding, not a ceiling for cost. Ask providers for interchange++ pricing, where each component is shown per transaction. Reconcile settlement files against transactions so the real cost per merchant, card type and country is known. Operators that have that data can route transactions to the cheapest acceptable provider and can show merchants a cost breakdown that a blended rate never gives. The cap protects consumers' interchange; the operator's reporting protects the other two thirds.