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Guidance on the PSR’s approach as a competent authority for the EU Interchange Fee Regulation - June 2020

Published 16 06 2020

This is our revised guidance on how we will monitor and enforce the Interchange Fee Regulation (IFR) and replaces our original guidance published in 2016.

The IFR is EU legislation that took effect on 8 June 2015 and brought major changes to the way card payment systems operate in Europe.

Most notably, since 9 December 2015, it caps the interchange costs passed on to merchants processing card payments, therefore giving more certainty around interchange fees.

Interchange fees are fees paid by the bank of a merchant (such as a supermarket) to the bank of a card user (such as somebody buying groceries) when a card payment is made. Interchange fees are one part of the total cost to the merchant of processing a card payment, which is known as a merchant service charge or MSC.

In November 2015 HM Treasury confirmed that the PSR would be the main competent authority, or lead regulator, for the IFR in the UK. 

The 2020 revisions to our IFR Guidance amend Chapter 7, so that it is consistent with our revised Powers and Procedures Guidance (PPG) where appropriate.