Plans have now been published by the EU to cut retailers' costs but this could mean we'll start paying more for our current accounts.

The cost of using your debit or credit card could be about to rise because of new European Union rules to cap the amount retailers have to pay when processing transactions.

Every time a transaction is made, retailers must pay a fee towards the bank providing the card, but these are to be capped to 0.3% of each transaction.

Capping these 'interchange fees' will reduce retailers' outgoings by £2.4 billion. But it's feared that retailers may not pass on their savings to consumers, while banks will meet the shortfall by increasing the amount people pay for debit and credit cards.

Compare current accounts

Interchange fees
Under the new plans, shops and businesses will pay no more than 0.2% for debit cards and 0.3% for credit cards when processing a transaction from a foreign card.

At the moment retailers pay the banks around 0.9% for credit card transactions so the change will make quite a difference. These are then passed onto shoppers in the form of higher prices for the things we buy.

Many customers are unaware of the extra costs because they are absorbed into the price of the things we buy. But the British Retail Consortium (BRC) predicts that the changes will save the whole sector around £362million.

The EU also wants to ban surcharges, such as when you pay 'administration' fees for booking airline tickets.

These fees vary wildly between different countries and there are no clear guidelines over the amount they should be. Capping these fees, the EU says, will help to create an EU-wide payments market.

How customers lose out
There is confusion over who will pick up the cost when the changes come into force.

It could be the case that savings are passed onto consumers and therefore the things we buy go down slightly in price.

More concerning could be that the banks, which will lose out when the caps are implemented, will make the money back by charging customers more to open a current account.

A study published earlier in the month by European Economics and the University of Essex for MasterCard suggested we could pay £11 for debit cards and £25 for credit cards.


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