Brussels is once again insisting that Visa Europe – the provider of many credit cards in Malta – scrap its inter-banking charge.

The European Commission says there is no valid reason for the charge – known as Multilateral Interchange Fees (MIFs) – to be levied and that it should be scrapped.

A similar legal challenge by the Commission against MasterCard, Visa’s main rival, was upheld by the European Court and the company lifted the MIFs some two years ago.

Brussels is now expecting Visa to follow suit.

All credit card transactions in Malta through Visa are currently charged a 0.2 per cent fee on their value, paid by shopkeepers to the bank.

In the case of Malta and another seven EU member states, this does not only apply to cross-border purchases but also to all domestic transactions.

Although the fee is charged to retail outlets, at the end of the day this is paid by consumers as the charge is recouped through the final selling price of goods and services.

According to a statement issued in Brussels, the setting of minimum prices for processing payments restricts competition between banks, inflates the cost of payment card acceptance and ultimately increases consumer prices.

The Commission rejected Visa’s argument that a minimum level of fees was necessary to guarantee funds for technical and economic progress.

Following this latest warning, the Commission may decide to step up its action against Visa.