The UK Payment Systems Regulator will not examine all charges on card transactions despite announcing a review of card-acquiring services last July.
Advantage Travel Partnership chief executive Julia Lo Bue-Said described the decision as “only doing half the job”.
The regulator confirmed last week it would “not assess the fees merchants pay for card-acquiring services” and “not examine whether the supply of services provided by card scheme operators is working well for users of card payment systems [including agents]”.
It acknowledged retailers’ concerns about the level of fees and noted requests “to review the level of scheme fees” but said: “We have limited resources.”
Agents have had to absorb the full cost of fees on all credit and debit card transactions since the EU Payment Services Directive 2 came into force in January last year.
Lo Bue-Said described the regulator’s decision as “really disappointing”. She said: “The key issue is the transparency of fees. The impact has been significant.
“The review will only be doing half the job. There is a need for a full and wider review.”
Abta welcomed “the broad scope” of the review. But head of public affairs Luke Petherbridge said: “Members highlighted their frustration with the lack of transparency in the various fees they pay for card payments.”
These fees are made up of an ‘interchange fee’ paid by one bank to another, a ‘scheme fee’ charged by the card-scheme provider, and an ‘acquirer fee’ levied by the transaction processor. Only the interchange fee is transparent.
The British Retail Consortium said scheme fees alone had risen by £1 billion a year recently.
Petherbridge said: “The current marketplace does not serve the best interest of businesses, especially SMEs.”
An Abta spokesman added: “Abta asked for a wider scope, including a focus on scheme fees. [But] it is important to remember the market review was a response to concerns raised around compliance with the EU’s Interchange Fees Regulation.
“The PSR’s review will focus on enhancing transparency for merchants and increasing competition amongst card-payment acquirers, both of which are important issues raised by our members.
“We also note respondents are invited to share views on wider issues, including on scheme fees. Abta will conduct a detailed consultation with members and asks the PSR to consider carefully all concerns raised.”
Lo Bue-Said told Travel Weekly: “We felt the [card] surcharge ban was extremely positive for the consumer. However, the impact for our sector has been significant.
“There is a need for a wider review to understand the impact, in particular, on travel agents who are unable to absorb any increase in business cost into prices.”
She added: “Transparency on the scheme fees is important as our members have not benefited from any reduced cost of taking payment cards.
“We remain hopefully the review will lead to the regulator having a better understanding of the overall impact.”