How would the demise of free banking affect Pockit cardholders?

14 August 2013
Are you the owner of a credit or debit card? Do you regularly use them? How would you feel about facing soaring charges for using them?  There is a threat to free banking as the EU plans to cap or cut the fees that underpin the payment card system. You could be faced with being charged just to use cash machines and accounts just because banks are trying to make up for a £2.4 billion loss.  Some of you may already be charged for unauthorised overdrafts, bounced cheques, or failed direct debits, do you really want to face paying these extra charges too?


According to the European Commission, the fees that retailers have to pay banks every time they take a card payment will be scrapped or limited, which means that banks could face losing up to 34p for each credit card transaction. According to the Telegraph the UK Cards Association, which represents the debit and credit card industry, said the ‘European Commission’s plan would hurt British consumers for little or no corresponding benefit’. The Express asserts that ‘consumers could pay at least £25 a year to use a credit card and £11 a year for their debit card’ which is stated in a report from Europe Economics with Mastercard. There will not only be charges for using a debit or credit card, but the cashback, rewards and interest-free periods on cards will ‘become a thing of the past too,’ according to the Telegraph.  What do you think about this?


Where does Pockit fit into all of this? Pockit operates in the prepaid card space and is therefore not connected to any banks; our card offers a transparent and convenient way to manage your money without the risks associated with credit and overdrafts. In addition, our Pay Monthly card has cashback deals ranging from 2-10% with some of the leading UK retailers, unlike the banks our cashback is funded by the retailers so it is here to stay! For those customers who do not want to pay a monthly fee, we also have a Pay As You Go Card, which comes with a low application fee of £5 and a 45p cost per transaction so you only get charged when you use it!


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