ACS (Association of Convenience Stores) has responded to the Payment Systems Regulator’s (PSR) consultation on card scheme and processing fees, welcoming proposals to improve transparency and strengthen governance, but warning that these measures alone will not address the fundamental lack of competition in the market.

ACS is calling on the Government and the PSR to fully implement the transparency and pricing governance remedies, ensuring that changes to fees are clearer, more predicable and subject to proper scrutiny. However, transparency alone will not tackle the underlying lack of competition. ACS is urging the Government to go further and keep a cap on scheme and processing fees under active consideration to curb constant fee upward pressure on costs.

Convenience retailers operate in a payments market where accepting card payments is affectively unavoidable. Customers expect to be able to pay by card, meaning retailers cannot realistically opt out or negotiate the fees. With tight margins and high volume, low value transactions, even small, incremental fee increases quickly accumulate, directly hitting the viability of local shops.

ACS Chief Executive James Lowman said: “Convenience retailers want to offer customers a wide choice of ways to pay, but they operate in a market where card scheme fees are unavoidable and continue to rise without clear justification. Transparency and stronger governance are welcome, but they won’t stop costs rising year after year. To make this market work for businesses and consumers, the regulator must be ready to go further – including keeping a cap on scheme and processing fees firmly on the table.”

ACS' full submission to the consultation is here.