Banks accused of milking UK businesses
The British Retail Consortium (BRC) has today come out in support of UK retailers who believe that "unjustifiably high" fees on credit and debit card sales are impacting upon their competitiveness. The BRC estimates that a credit card transaction costs UK retailers 34p, debit card transactions 8.5p and cash transactions 2.1p. As a consequence additional costs of around £480 million are being taken from the economy with 76.7% of all retail spending carried out using some form of card.
Despite the fact that we now live in a near cashless society with regards to retail spending there would seem to be a massive differential between the cost of transactions completed with a credit card and those completed with cash. Whether or not we would actually see the estimated £480 million of additional costs returned to consumers in some way, if costs were realigned, is debatable but this is a significant annual "charge".
It is unclear whether these charges have increased over the last couple of years as banking institutions look to open other avenues of income. However, the myth of "free banking" in the UK is in many ways something of a joke due to a variety of charges targeted at not only businesses but the UK public as a whole.
Share this..
Related stories
It is time to review your credit card arrangements?
Even though UK base rates are currently standing at 1% and set to fall as low as 0.5% later today how is it that the vast majority of credit card interest rates are still very much into double digits?
While the government has highlighted the mortgage arena and the need to encourage new credit flows in the UK, the credit card industry appears to have escaped unscathed as yet. This is...
Rate tarts urged to cut card spending immediately
Borrowers who swap credit card providers to take advantage of cheaper interest rates should curb their spending immediately after securing their new deal, a price comparison site has warned. A study conducted by MoneyExpert found that 5.9 million people switched credit card provider during the last six months of 2007. In so doing, they are able to more effectively manage their debts due to favoura...
Read MorePetrol credit card scam linked to Tamil rebels
UK motorists have become the target of a credit card scam that allegedly funds Tamil rebel groups in Sri Lanka.In the scam, customers' card details are obtained when the card is used to pay at petrol stations. Money is then transferred from accounts to other accounts around the world.Detective Inspector Paul Welton, whose Humberside region is one of those believed to have been caught up in the fra...
Read MoreDo I need a credit card?
If there is one area of personal finance which has caused hardship for millions in the UK, aside from mortgages, it has to be the credit card industry. In the boom times many consumers in the UK used their plastic friends to increase their spending capacity with the idea that they would pay off any outstanding balance at the end of the month or else gradually pay off their short-term debt without...
Read MoreCredit crunch hits holiday spending
As credit becomes less and less freely available and the cost of day to day living edges up, millions of Britons are now planning to cut their spending on holidays. With the credit crunch deepening, lenders have responded by raising rates of credit cards and loans and tightening their criteria for approving credit. In response, a survey has shown that Britons are planning to cut their spending on...
Read More