Holly Cairns
Question:120. Deputy Holly Cairns asked the Minister for Finance the steps he is taking to address the rates charged to hospitality businesses by financial institutions for transactions carried out with cards. [29565/23]
View answerThursday, 22 June 2023
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The merchant service charge is the fee charged by an acquirer to a business for processing card transactions. All acquirers in Ireland are independent commercial entities and the amount of the merchant service charge varies, often depending on the volume of card transactions the retailer accepts.
One aspect of the merchant service charge is the interchange fee, which is charged by card issuing banks to businesses for accepting card payments. Since 2015, interchange fees on consumer debit and credit cards have been capped. Under the Interchange Fee Regulation, Ireland set the maximum interchange fee at 0.1% of the value of transactions for domestic consumer debit cards and 0.3% of the value of transactions for consumer credit cards. However, the Interchange Fee Regulation does not cover commercial debit and credit cards.
In Ireland, there is no domestic card payment scheme. Irish card payments are primarily facilitated by international card payment schemes such as VISA and MasterCard. As part of its role as a national competent authority, the Central Bank seeks independently verified transaction and fee information from international card schemes operating in Ireland to ensure that they are operating in compliance with the Interchange Fee Regulations.
While regulated entities must comply with the rules regarding interchange fees, the merchant service charge is a commercial decision for each service provider. Acquiring services is a competitive market and businesses in general, and smaller businesses in particular, could stand to benefit from lower rates by switching provider.