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Provisional determination of card schemes that are subject to domestic interchange fee caps in the UK

Published 08 12 2015
Last updated 24 03 2016

On 19 November 2015 we issued an information request about the value of UK domestic debit and credit card transactions

This was to help us calculate the market share of three-party card schemes that may qualify for an exemption from the IFR interchange fee caps on UK domestic card-based payment transactions.  

The IFR, or Interchange Fee Regulation, is a new piece of EU legislation that goes live on 9 December 2015. It will bring major changes to the way UK card payment systems operate. 

As we set in our draft guidance on how we intend to regulate the IFR in the UK, there is one scheme that could potentially qualify for an exemption in the UK: American Express.

We have now had a chance to consider the information we received. We have provisionally concluded that the market share of American Express, between 9 September 2014 and 8 September 2015, was above the 3% threshold. A scheme which is above the threshold may not be exempted from the interchange fee caps on domestic transactions and must comply with the fee caps

Therefore, our provisional conclusion is that American Express and any payment service providers participating in the American Express scheme must comply with the interchange fee caps on UK domestic transactions until 31 March 2016. 

At this stage we are only making a provisional decision. We will confirm our final determination once we have:

  • received confirmation that the information we hold is correct, following 9 December 2015, and
  • completed our consultation on draft IFR Guidance which will allow us to take account of consultation responses and finalise our approach to regulating the IFR in the UK. 

Our final guidance will be published alongside a statement setting out those schemes that are exempt from the domestic interchange fee caps for the period to 31 March 2016.

Update: on 24 March 2016 we published a final determination and our final guidance for Phase 1 of the IFR.