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New Mastercard / Visa fee caps agreed with the European Union

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In case you missed it in the mainstream press last week, Mastercard and Visa have made a further concession to the EU over their demands for lower interchange fees.

Both companies have agreed to cut the fees they charge retailers when they process debit or credit cards issued outside the EU.

Mastercard and Visa are already obliged to cap interchange fees at 0.2% for debit cards and 0.3% for credit cards on transactions made in the EU on EU-issued cards.  From 19th October, this cap is now voluntarily extended to all Mastercard and Visa cards issued globally.

Online purchases made from EU retailers with non-EU credit cards are excluded.  Mastercard and Visa have voluntarily agreed a separate cap for online transactions of 1.15% for debit cards and 1.5% for credit cards. 

The justification for this is that there is greater fraud risk with online spending – the cost of which is pushed back to the card issuer – and that PayPal, Alipay etc provide greater competition in online payment processing.

This will have no impact on UK cardholders, but it will start to tighten the screws on the profits of foreign-issued credit cards.  In time, this is likely to lead to the end of the high sign-up and spend incentives seen in, say, the United States.

Want to earn more points from credit cards? – May 2024 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

Barclaycard Avios Plus card

Barclaycard Avios Plus Mastercard

Get 25,000 Avios for signing up and an upgrade voucher at £10,000 Read our full review

Barclaycard Avios card

Barclaycard Avios Mastercard

5,000 Avios for signing up and an upgrade voucher at £20,000 Read our full review

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

Marriott Bonvoy American Express

HUGE 60,000 POINTS BONUS UNTIL 3rd JULY and 15 elite night credits each year Read our full review

British Airways American Express Premium Plus

25,000 Avios and the famous annual 2-4-1 voucher Read our full review

American Express Preferred Rewards Gold

Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review

The Platinum Card from American Express

40,000 bonus points and a huge range of valuable benefits – for a fee Read our full review

Virgin Atlantic Reward+ Mastercard

18,000 bonus points and 1.5 points for every £1 you spend Read our full review

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

British Airways Accelerating Business American Express

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review

American Express Business Platinum

40,000 points sign-up bonus and an annual £200 Amex Travel credit Read our full review

American Express Business Gold

20,000 points sign-up bonus and FREE for a year Read our full review

Capital on Tap Business Rewards Visa

10,000 points bonus – plus an extra 500 points for our readers Read our full review

For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.

Barclaycard Select Cashback Business Credit Card

1% cashback uncapped* on all your business spending (T&C apply) Read our full review

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