Fees:


changing the rules A


Some complex EU legislation is about to engulf the corporate card market and travel managers should prepare themselves for the changes on the way


fter more twists and turns than the Cresta Run, a slice of European legislation called the EU (European


Union) Interchange Fee Regulation finally took effect in December 2015. It may sound innocuous enough, but the new law has metaphorically lobbed a massive lump of concrete into the usually placid millpond that is the world of cor- porate cards. If your organisation uses individual pay corporate cards (where cardholders settle with the issuer out of their private bank accounts and are then reimbursed by their employer), the shockwaves will severely rock your travel programme. But even if you are a corpo- rate pay customer (settling centrally with the issuer) or client of American Express (which is exempt from the regulation), you may still feel the ripples. At the heart of the legislation is a cap on interchange fees at 0.3 per cent for credit cards and 0.2 per cent for debit cards. An interchange fee is the fee that an acquiring bank (the bank used by a merchant for accepting card payments) pays the issuing bank of the cardholder every time a payment is made on it. According to the UK Payments Systems Regulator, the previous average interchange fee was 0.8 per cent, while Airplus International says average fees charged on commercial cards across Europe are 1.5 per cent. The intention of the regulation is to save shopkeep-


ers, restaurants and other merchants Ð6 billion in card fees per year, the European Commission (EC) has said – although some experts believe card companies will simply claw back the money in other ways.


10 BBT CORPORATE CARDS SUPPLEMENT 2016 In association with


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