Retailers call for cut in card charges
EAST of England businesses have joined national retailers in calling on banks to reduce their “prohibitive” plastic card processing charges as a survey revealed more than half of transactions are still in cash.
EAST of England businesses have joined national retailers in calling on banks to reduce their “prohibitive” plastic card charges as a survey revealed more than half of transactions are still in cash.
The British Retail Consortium (BRC), which carried out a “cost of collection” survey, has claimed there is a drive by plastic card issuers to kill off cash, and condemned it as a “self-serving attempt to rake in millions more in charges”.
The BRC said customers did not realise the “huge” sums retailers were charged for processing card payments.
On average, a £20 cash transaction costs a retailer less than four pence, while a £20 credit card transaction costs at least 17 pence, it claimed.
You may also want to watch:
Collecting all payments, including cash, cards and cheques, cost retailers £317million last year, with processing of credit card payments accounting for 51% of that, even though they represented only 22% of sales turnover, it said.
BRC director general Kevin Hawkins said: “Banks have long abused their position by imposing much higher charges on retailers for processing card payments than cash. Clearly the banks have spotted that replacing cash with cards would mean a further boost to their profits.
- 1 Postman who abandoned 'undriveable' van wins unfair dismissal claim
- 2 Jack Whitehall praises award-winning Suffolk gastropub after visit
- 3 A14 and A12 set for major upgrade work
- 4 Town face competition from Championship club for Rotherham midfielder Crooks
- 5 Cornell attracting Championship interest as Ipswich contract is terminated
- 6 The 36 best restaurants in Suffolk according to the AA guide
- 7 GP surgery with more than 3,000 patients announces closure
- 8 Full list: Everyone in Suffolk in the Queen's Birthday Honours 2021
- 9 5 cheap or free things to do in Suffolk this weekend
- 10 Oxford boss hits out at 'ludicrous' League One spending while appearing to take swipe at Ipswich Town
“Retailers are not opposed in principle to cards taking a bigger share of the payments market, but as they try to accelerate that process, the banks should acknowledge their card charges are too high. There should be a lower, fixed fee per transaction which actually reflects the costs of processing.”
David Burch, East of England policy officer for the Federation of Small Businesses, said the charges were “extremely prohibitive” for retailers.
About 23% of their membership in the region was made up of retailers, and most of them supported a range of payment options, he said.
“Most of them wish to see as wide a range of payment options as possible,” he said.
“We would also welcome a reduction in charges for the use of these cards because they are extremely prohibitive to retailers.”
Around 70% of their East of England FSB members still relied heavily on cash and cheques to receive and make payments, he added.
Andy Rayner, a member of Suffolk Chamber of Commerce said the issue affected retailers more when they were small businesses.
“For a small, independent business that could certainly hurt you,” he said. “The banks have had it in a lot of ways their own way for many years.”
He called for all costs to be looked at and reduced accordingly.
“It's all about being fair. Everybody has to earn a living and everybody has to make a living in business,” he said. “What we are trying to do as retailers is to offer as many ways to pay as possible. Because you want to make that sale in a lot of ways you swallow that cost.”