The European Union has agreed to cap the cost of processing debit and credit card payment fees, following campaigns from the British Retail Consortium and UK retailers.
Retailers have welcomed the news, as the high card fees currently cost UK businesses more than 1 billion pounds a year, according to the BRC. Under the new rules, fees will be capped at 0.2 percent for debit cards and 0.3 percent for credit card transactions.
The price cap will not initially apply to the so-called three-party card schemes, such as American Express and Diners, which involve only one bank.
"This legislation is good for consumers, good for business, and good for Europe. It will lead to lower prices and visibility of costs for consumers," said Margrethe Vestager, commissioner in charge of competition policy.
However, the cap still has to be endorsed by EU governments and approved by the full European Parliament before it can come into effect.
The BRC has welcomed the ruling, Helen Dickinson, BRC director general, commented: "We are delighted with this historic and landmark agreement. We have long campaigned for a cap on excessive and anti-competitive card payment fees. Once implemented in the UK during the course of 2015 this will enable the retail industry to invest an extra £500 million a year in innovation and value for consumers."