When it comes to any credit card processing program, the swipe fee remains a hot button topic in the payment industry. It has led to lawsuits, changes in business practices and industry debate. The latest question involves a potential cap for commercial cards that could threaten the future of the card.
According to a recent article from PYMNTS, European Parliament's Economic and Monetary Affairs (ECON) Committee could be voting on a multilateral interchange fee for all credit and debit cards, both personal and commercial.
This would be done to set a standard across the industry that many retailers and consumer groups have called anti-competitive and costly. Visa and MasterCard, which together controls more than 95 percent of the credit card industry in Europe, are against a cap, claiming it would hurt businesses and consumers as banks would now need to find an alternative way to make up the credit fees that will be created.
The article features comments from the head of MasterCard Commercial Products in Europe, Andrew Buckley. He mentioned that treating commercial cards the same as consumer cards is the equivalent of treating a family car the same way that you do a commercial truck.
"Commercial cards were not included in the original proposals for good reasons," the article reads. "They differ significantly from consumer cards in purpose and usage, and bring huge benefits to small businesses. Copy-pasting proposals designed for consumer cards would drive the cost of commercial cards up substantially and make them too expensive for many small businesses."
While this is currently happening in Europe, it not out of the realm of probability that something very similar could happen in the U.S.