Banking & Fintech /

Changes in fees for foreign transfers

The European Union is introducing new rules on international transfers. The main purpose of the regulation is to reduce the costs of foreign transactions carried out in the euro currency by citizens of countries that are not members of the euro area. According to the press release of the European Parliament, consumers, among other, from Western European countries, they use a single payment area, while others bear high costs of transfers.

According to the statistics presented by the European Parliament, this will save over 1 billion euros per year for individuals and entrepreneurs. The new measures are intended to protect consumers against the charging of arbitrary currency conversion costs. The consumer is to be informed about the amount to be paid in the local currency as well as the currency of his account. The new regulations also apply to the DCC (dynamic currency conversion) service offered by the operators of payment terminals and ATMs, that is, the service consisting of the possibility of executing a non-cash or cash transaction abroad in the currency in which the payment card was issued. It is known not from today, that this type of services are expensive, often much more expensive than currency conversion made by the bank. At the same time, it was not decided to limit the maximum DCC costs, but only to require operators to inform, according to which the consumer should know the exact amounts before accepting the transaction. Transparency is supposed to be provided by one basis for calculating the spread.

An obligation to inform the customer via SMS, electronic mail or a push message from the mobile application on the applicable currency conversion costs was also introduced, with the reservation that banks will not be able to charge for the notification service

Author team leader DKP Legal Piotr Putyra
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