Card Payment Fees Rise, Potentially Impacting Consumer Prices
Translated & summarized from Al-Shams by baba
Businesses are facing increased costs due to new fees for card payment services, with some charges rising significantly. A business using a typical setup saw its monthly costs increase by 15%, and this is expected to rise further in January. While consumers won't see direct charges, businesses may pass on these higher operational expenses through increased prices for goods and services. The full impact of the fee changes will be phased in by 2027.
The story in 6 lines · by baba
- Card payment service fees have increased, raising operational costs for businesses.
- Monthly costs for businesses using card readers and terminals have risen by up to 15% already.
- Further fee increases are scheduled for January, potentially raising monthly costs by 30% overall.
- Fees for ATM transactions have seen a jump of over 500%.
- Businesses may pass increased costs onto consumers through higher prices for goods and services.
- The full impact of the new fee structure will be implemented by early 2027.
New fees for card payment services have begun to take effect this week, increasing operational costs for businesses. Further increases are scheduled for January. The monthly subscription for card readers has risen from 6 to 8.75 shekels before VAT, while terminal fees have decreased from 14.5 to 13 shekels. In January, the card reader subscription will increase to 11.5 shekels, and terminal fees will also be 11.5 shekels.
For a business using one payment terminal and two card readers, the monthly cost has gone up from 26.5 to 30.5 shekels, a nearly 15% increase. This cost is projected to reach 34.5 shekels in January, representing a 30% rise from the original price.
The fee hikes extend beyond payment devices, affecting infrastructure for processing card transactions and cash withdrawals. Fees paid by card companies to the infrastructure operator have increased. Approval fees for some transactions have risen by approximately 38%, collection fees by 36%, and the monthly subscription for the financial transfer system has surged by about 77%, from roughly 5,790 to 10,261 shekels. ATM transaction processing fees have jumped from about 0.87 agorot to 5.4 agorot per transaction, an increase of over 500%.
While consumers will not directly pay these new fees at the point of sale, the increased operational costs for businesses may lead some to pass on these charges to consumers through higher prices for goods and services. Card companies are contesting some of these increases. The infrastructure operator argues the new fees are necessary to fund investments in systems, security, and protection, especially given the growing volume of transactions. The new fee structure will be fully implemented by early 2027, following a transitional period, meaning the full impact will not be felt immediately.