The UK’s Payment Systems Regulator (PSR) has fined major bank Barclays 8.4m for failing to comply with the Interchange Fee Regulation (IFR).
The reason, according to PSR, was that Barclays “failed to provide retailers with complete information on the cost of the card services they provided”.
As a result of Barclays’ actions, it said, “retailers did not readily understand the transaction fees associated with accepting certain types of card payments.”
PSR explains:
“Barclays’ failure meant that retailers were not fully aware of the fees they were paying, effectively comparing prices for card services, shopping to find cheaper deals, We couldn’t have negotiated the best deal with Barclays.Your money.”
The UK’s main body that enforces the IFR, the PSR, has confirmed that Barclays has failed to comply with the rules for a total of more than three years between December 2015 and December 2018.
During this time, Barclays processed a third of all card payment transactions in the UK. Thousands of retailers and transactions were affected.
In addition to the 8.4m fine, the regulator said it had made the full information required under the IFR available to all retailers using Barclays card payment processing services.
The investigation was launched on November 15, 2018. Barclays agreed to settle as soon as possible and was therefore entitled to a 30% early settlement discount.
Without this discount the fine would have been 12 million.
If a bank is not IFR compliant, retailers have the power to intervene to ensure compliance with these important rules so retailers can make informed decisions about which services to use. We can do that, said Chris Hemsley, managing director of PSR.
Earlier this year, it fined another high street bank, NatWest, 1.82m for overcharging credit card exchange fees.