2 PAYMENT METHOD PROFILES: CARD
In Europe, Article 8 on “co-badging and choice of payment brand or payment application” of the Interchange Fee Regulation, states that “the consumer may require two or more different payment brands on a card- based payment instrument provided that such a service is offered by the payment service provider.” 181 This article also allows merchants to steer the transactions as long as it does not prevent the consumer from overriding the selection. Card Fee Costs Rising Interchange Fees In the United States, merchants have experienced several instances of credit card interchange fee increases. For example, networks have increased interchange for certain credit card types by 20 basis points over the course of the period 2021-2024. 182
Network 1 Interchange Fees (2019-2024)
$- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00
Network 1 - High Rewards Product A
Network 1 - High Rewards Product B
Graph 2.15
In markets where interchange is capped and regulated for consumer credit and debit cards, interchange increases have been less common. Network Fee Increases In the United States, retailers paid an estimated $21 billion in network fees in 2024, up from $19.1 billion in 2023. This is largely driven by rising volumes, but there are instances of recent fee increases in 2024 which have resulted in millions in additional costs. 183 Not only has the overall cost of network fees risen, but the total number of scheme fees has risen significantly. From 2018 to 2024, CMSPI estimates that the total number of network fees have more than doubled for each global network, with behavioral/penalty-based network fees representing the majority of the increases. Many of these new fees, which can penalize excessive retries or retries based on certain decline codes, have disproportionately impacted digital and subscription merchants over this period. However, nearly all merchants have been impacted by recent fees introduced in early January 2025, which include increases to per transaction and digital assessment fees. 184
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