Joe Carey (Clare, Fine Gael)
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366. To ask the Minister for Finance if his attention has been drawn to a dramatic increase in the charges that have been incurred by traders who receive payments by debit card (details supplied); if he will raise these severe increases with the Irish Financial Services Regulatory Authority with a view to bringing about a more equitable charging system for traders; and if he will make a statement on the matter. [1949/23]

Michael McGrath (Cork South Central, Fianna Fail)
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Traders must consider a number of factors before choosing to accept any type of payment instrument. In the case of accepting card payments, one of the most relevant factors considered by a trader are the fees that it must pay.

The fees paid by merchants for the processing of card payments are collectively known as the Merchant Service Charge. One of the most common fees included in the Merchant Service Charge is the interchange fee i.e. the fee paid between the payer’s bank (the card issuer) and the payee’s bank (the bank used by the trader) to cover handling costs.

The European Commission has acknowledged the negative impact that excessive interchange fees can have on card acceptance. In an effort to address this issue (amongst others) in the market, the EU introduced  Regulation (EU) 2015/751 on interchange fees for card-based payment transactions (commonly known as the “Interchange Fee Regulation”), which introduced interchange fee caps for both credit and debit card transactions.

In Ireland, the Central Bank of Ireland is one of the national competent authorities for the purpose of ensuring compliance with the Interchange Fee Regulation and the European Union (Interchange Fees for Card-Based Payment Transactions) Regulations 2015 (the “Irish Interchange Fee Regulations”) which gave effect to the Interchange Fee Regulation in Ireland.

Under the Irish Interchange Fee Regulations, payment service providers are prohibited from offering or requesting an interchange fee of more than the equivalent of 0.10% of the value of the individual debit card transaction.

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 national competent authority role, 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 Irish Interchange Fee Regulations.  

However, while regulated entities must comply with the rules regarding interchange fees, card transaction charges are a commercial decision for each service provider.