The IFR brings major changes to the way UK card payment systems operate. In particular, it introduces caps on interchange fees on debit and credit card transactions where the issuer and acquirer are located in the European Economic Area (EEA).

Where the market share of a three-party card scheme is under 3%, however, the scheme may qualify for an exemption from the fee caps. In this connection, on 8 December 2015, and in making a provisional determination of card schemes that are subject to the domestic interchange fee caps in the UK, the PSR said that American Express will not be exempt.

What this means for you

In setting out how it was going to regulate the IFR, the PSR considered whether the American Express scheme might qualify for an exemption from the incoming regulations. The PSR concluded on a provisional basis that between 9 September 2014 and 8 September 2015, American Express’ market share was above the 3% threshold. As such, American Express, and any PSPs participating in the American Express scheme, were not exempt and must comply with the domestic interchange fee caps until 31 March 2016.