Cross Border Acquiring rules brought in across the EU last year have led to a price war among acquirers, driving down transaction costs for merchants savvy enough to demand reductions from January 2015.
As cash treasury management expert Jack Large explains, the regulation undercuts existing MSCs by allowing cross-border acquirers that have regulated operations outside a country to bid for domestic merchants using the 0.2% and 0.3% interchange. As a result, many merchant acquirers have responded by setting up regulated operations outside their home country, sparking a price war.
For companies subject to high transaction fees, the potential rewards are significant. The payment and technology consultants PSE Consulting estimate that an organisation processing €15m of payments across Europe could stand to save over €72,000 per year in fees.
Of course, not everyone is thrilled by the increase in price competition. According to PSE Consulting: “the concessions have generated the most disruptive challenge Europe’s acquirers have ever addressed ” and that “high credit card interchange countries such as the UK, Germany, Portugal and Sweden are very vulnerable and are most threatened by major reductions in interchange revenues.”
According to Large, merchants have already begun asking their acquirers for substantial reductions, effective as of January next year.
Small businesses may make the world go round, but struggles with book balancing and accounts can be distracting and end up throttling ... read more
The Swiss reinsurer highlights 21 emerging risks that its industry and society in general should keep on its radar.
For organisations looking at purchasing new risk solutions in order to address increasing pressures in this area, the bobsguide Risk Management Systems Guide features a comprehensive matrix allowing buyers to compare and contrast the different functionalities of solutions in the market today.
Treasury Innovation Forum (TIF), a GTNews event, is designed to provide treasury and finance professionals with industry analysis, peer-to-peer-discussion and access to the latest industry research. Taking place on the 29th June at DoubleTree Hilton, Victoria, London, this one-day event promises to provide insight to helps treasury professionals stay one step ahead.