To ask Her Majesty’s Government what is the present status and purpose of the Office of Fair Trading investigation into the charges for transactions made using MasterCard and Visa credit cards; when that investigation began; what are the permissible interest rates those companies can charge; and whether they intend to encourage new entrants to the credit card market.

The Office of Fair Trading (OFT) has an ongoing investigation, under the Competition Act 1998 and Article 101 of the Treaty on the Functioning of the European Union, into the interchange fee arrangements for UK domestic point-of-sale transactions made using MasterCard/Maestro and Visa consumer payment cards. These are charges paid by the retailer's bank to the bank that issued the payment card. The investigations were opened in May 2004 (Visa) and December 2005 (MasterCard).

The OFT's investigations concern domestic (UK) interchange fee arrangements. Separately, the European Commission has investigated cross-border interchange fees.

The UK Government (with the OFT as lead department) has intervened in support of the European Commission before the Court of Justice of the European Union in the appeal proceedings brought by MasterCard against the 2007 decision of the European Commission regarding MasterCard's, including Maestro's, intra-European cross-border interchange fee arrangements. On 24 May 2012, the General Court dismissed MasterCard’s appeal. MasterCard’s further appeal to the Court of Justice was heard on 4 July 2013. The OFT intends to consider whether to issue Statements of Objections in respect of its own investigations following the conclusion of these proceedings.

The interest rates charged to consumers by credit card issuers are not the focus of these investigations. The OFT does not set permissible interest rates payable to credit card issues.

The OFT does not have a remit to encourage new entrants to any particular market. However, it seeks to tackle barriers to entry and anti-competitive behaviour where there is evidence of a problem. In addition to the current investigation, the OFT has conducted reviews of the barriers to entry in retail banking and of payment systems, details of which can he found on its website.