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January 25, 2018updated 24 Jan 2022 6:29am

UK’s travel trade association seeks reduction of charges on card payments

Association of British Travel Agents (ABTA) has submitted a letter to the Treasury calling for urgent and thorough review of the country’s card payments market.

The letter was co-signed by the Association of Independent Tour Operators (AITO), Scottish Passenger Agents’ Association and The Advantage Travel Partnership.

A survey performed by ABTA revealed that 58% of respondents had seen rise in their card processing costs, regardless of the European Union’s Interchange Fee Regulation (IFR).

IFR was launched in 2015 to lower card charges and caps the interchange fees, which is charged by banks and card providers to each other, at 0.2% for debit and 0.3% for credit cards.

In its letter, ABTA alleged that this fee appears to have been increased by cards providers to ‘make up for the shortfall in revenue’.

The UK travel trade association has also demanded greater transparency across the payments chain and asked the government to address any misplaced perceptions with better explanation regarding the changes made to the card payment charges.

ABTA chief executive Mark Tanzer said: “When the European Union introduced the IFR and the subsequent Payment Services Directive, the intention was to reduce card charges, to the benefit of the public.

“What has actually happened is that businesses are no longer able to pass on card payment card costs to their customers that choose to pay by card – but the costs to businesses still stand, and in some cases have gone up.

“This is not what the EU intended and the Government needs to conduct an urgent review into the charges made by card companies so that they are proportionate and fair and these real savings can then truly be passed on to consumers.”

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