Payment system operators Visa Inc. and Mastercard Inc. plan to increase the fees charged to retailers when their customers pay for purchases with bank cards, Bloomberg reports, citing documents in its possession.
Visa’s fee hike for online transactions will start in October and will affect credit, debit and prepaid cards in April. In the case of Mastercard, the increase will also start in October.
Industry consulting firm CMSPI estimates that the annual amount of fees paid by retailers could increase by more than $500 million as a result.
Although the fees are set by Visa and Mastercard, the bulk of the fees are collected by the banks that issue the cards. While the fees are small, retailers’ costs to pay them have risen in recent years as more shoppers use credit cards, which carry higher fees than debit cards.
Retailers shift at least some of these costs to consumers by raising prices. Small businesses often offer discounts to customers who pay with debit cards or cash.
