> "As a result of the UK leaving the EEA, Mastercard will adapt interchange rates on UK cards to the commitments it gave the European Commission in 2019 for non-EEA card transactions," the company said.
They are regulated, they're just allowed to charge more for EEA to non-EEA than they are EEA to EEA.
Surely the UK can only regulate Mastercard's fees to businesses within the UK? I guess they could ban UK consumers from buying from stores outside the UK that use Mastercard, maybe? Other than threatening to do that, how can they regulate what Mastercard charge businesses outside the UK?
I agree, Mastercard would rather have 0.3% fees on UK purchases from EU businesses than have the UK government enact such a ban. I just don't think the UK government would do that though. It'd be really hard to police too, do users even know the internal payment processor used by a store? It's probably labelled for marketing/trust but I doubt there's that much notice paid to it.
> MasterCard may reasonably believe they have power enough
> to do this.
The UK is still a large economy and there are quite a few other big players in the transactions handlers market. Given how several large companies are looking to setup micro-transactions with zero-cost transaction overheads, they might be shooting themselves in the foot.
The reason the UK should fight this is that they obviously currently have a lot of outgoings and very little income (like every Country during COVID). They will already have to raise taxes - if MasterCard are also raising their own form of tax this will even more greatly increase living costs.
> A government which is scarcely managing its current
Your original suggestion of regulation is politics. It's a political decision. When you say "the UK should fight this", you mean: "UK politicians should actively decide to act".
MasterCard making this move forces the UK government to show their hand - and it's not that MasterCard has made this decision without that in mind. It indicates that MasterCard thinks* there's a good chance UK government won't do anything.
(*or knows - they spend plenty on lobbying and will have spoken directly to decision-makers)
Regulated by who? UK govt should regulate what Mastercard charges in Europe? Or European govt should regulate what they charge customers outside their region?
They are regulated, they're just allowed to charge more for EEA to non-EEA than they are EEA to EEA.