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? – February 2023 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:
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.
SPECIAL OFFER: Until 21st February 2023, the sign-up bonus on the British Airways Premium Plus American Express card is increased to 35,000 Avios from 25,000 Avios. You can apply here.
British Airways American Express Premium Plus
35,000 Avios (ONLY to 21st February) 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
30,000 points and unbeatable travel benefits – for a fee Read our full review
Virgin Atlantic Reward+ Mastercard
15,000 points bonus 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:
American Express Business Platinum
40,000 points sign-up bonus and a £200 Amex Travel credit every year Read our full review
American Express Business Gold
20,000 points sign-up bonus and free for a year Read our full review
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
Capital On Tap Business Rewards Visa
Get a 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.