Card processing costs in the UK: what to check
UK card costs are shaped by capped domestic interchange, uncapped scheme and processing fees that the PSR found rose by more than 25% in real terms from 2017 to 2023, and higher interchange on UK to EEA online payments since Brexit. New PSR directions require the schemes to explain their fees to acquirers from 2026 and 2027.
What did the PSR find about scheme and processing fees?
The Payment Systems Regulator found that Mastercard and Visa raised core scheme and processing fees to acquirers by more than 25% in real terms between 2017 and 2023, costing UK businesses at least £170m a year (PSR final report, March 2025). Those fees sit on top of interchange and are not capped.
The PSR also concluded that the schemes "do not give acquirers sufficiently clear and detailed information about their fees", that acquirers struggle to get timely answers to clarification requests, and that scheme portals are hard to use. Some acquirers told it that behavioural fees they cannot understand cost them "hundreds of thousands of pounds" (PSR PS26/1, July 2026). Acquirers pass much of that cost on, so it reaches PSPs and merchants too.
What do the PS26/1 directions require, and when?
The PSR's final directions, published in July 2026 as PS26/1, bring in two sets of requirements on Visa and Mastercard. Pricing governance requirements apply from November 2026. From July 2027, the ITC remedy requires the schemes to give acquirers the fee logic needed to reconcile billed fees to the transactions they came from (PSR PS26/1, July 2026).
Fee logic means the rules that turn a transaction into a fee: which fee applies, at what rate, and on what basis. With it, an acquirer can recalculate a scheme invoice instead of accepting it. The regulator itself is changing shape: the government introduced legislation in May 2026 to fold the PSR's functions into the FCA (Norton Rose Fulbright). Our PSR remedies explainer covers the directions in more detail.
What happened to UK to EEA cross-border interchange?
Interchange on card-not-present payments between the UK and the EEA rose from 0.2% for debit and 0.3% for credit to 1.15% and 1.5% after Brexit, costing UK businesses an estimated £150m to £200m a year. The PSR dropped a planned interim cap in October 2025 (PSR statement, October 2025).
In January 2026 the High Court upheld the PSR's power to cap these fees, after a challenge by Visa, Mastercard and Revolut (FStech). The level and timing of any cap are still open. For UK businesses with EEA customers, this line will change when a cap is set. Any contract that passes it through should say how a cap flows to you, and the invoice should show it from its effective date.
Which other UK caps and rules affect what you pay?
Domestic consumer interchange in the UK is capped at 0.2% for debit and 0.3% for credit, the same levels the EU sets under its Interchange Fee Regulation (Ryft). Scheme fees and acquirer or processor mark-ups are not capped, so they are where cost moves.
For issuers, the caps limit revenue: several neobanks rely on interchange for most of their income (FinTechtris), so a scheme or processor overcharge takes a large share of a thin margin. For payment and e-money institutions, the FCA's CASS 15 safeguarding regime, in force since 7 May 2026, adds daily reconciliation, monthly returns and an annual audit (FCA). CASS 15 covers customer funds rather than supplier fees, but firms in scope now reconcile daily and hold data that can be used to check fees too.
What should UK issuers, PSPs and acquirers check now?
Each part of the UK payment chain has a different first check. Issuers should look at scheme and processor fees against their capped interchange income. PSPs and acquirers should test scheme invoices against transactions now, so they are ready to use fee logic when it arrives in July 2027. The table sets out where to start.
| Who | What to check now | Why now |
|---|---|---|
| Card issuers and fintech programmes | Scheme fees per card and per transaction, issuer-processor fees against contracted tiers, and sponsor pass-through against the scheme's own rates. | Visa raised its base transmission fee paid by issuers from January 2025 (Payments Dive), and capped interchange leaves little room. |
| PSPs and payment facilitators | Behavioural fees such as VAMP, scheme fees passed on to merchants against those paid upstream, and UK to EEA interchange on cross-border sales. | VAMP has charged $4 or $8 per disputed transaction above thresholds since April 2025 (Visa). |
| Acquirers | Scheme invoice lines against transaction counts by region and product, and fee change notices against their effective dates. | Pricing governance applies from November 2026 and fee logic from July 2027 (PSR PS26/1). |
How FeeVerify fits for UK payment businesses
FeeVerify builds a rulebook from your processing agreements, sponsor contracts and scheme fee schedules, recalculates every transaction against it, and traces each difference to the clause. With optional continuous assurance it runs on each new month of data, so a scheme fee change or a cross-border cap shows up in the month it takes effect.
Every rule carries a confidence grade, and a named reviewer signs off each material finding before anyone acts on it. Your data stays in its own environment and never trains a model; the governance page sets out how. FeeVerify is a UK-registered business.
Sources: PSR final report, March 2025; PSR PS26/1, July 2026; PSR cross-border interchange statement, October 2025; FStech on the High Court ruling, January 2026; Norton Rose Fulbright on the PSR and FCA, May 2026; FCA safeguarding requirements; Ryft guide to European payment fees, 2026; FinTechtris on neobank interchange revenue; Payments Dive on Visa fees; Visa VAMP fact sheet, 2025.
Start with one month of your own data.
A pilot begins with the agreements that protect both sides, then your contracts and one month of settlement data, scoped with a payments specialist on the first call. The 30-day diagnostic re-costs every transaction against them and shows each variance with its clause, before any recurring fee.