- Question ID
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2019_4811
- Legal act
- Directive 2015/2366/EU (PSD2)
- Topic
- Other topics
- Article
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64,52
- COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
- Not applicable
- Article/Paragraph
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Not applicable
- Name of institution / submitter
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Croatian National Bank
- Country of incorporation / residence
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Croatia
- Type of submitter
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Competent authority
- Subject matter
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The amount of a card payment transaction authorised online in HRK
- Question
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Please clarify for card payment transactions authorised by the Payment Services User (PSU) in Member State A’s currency online on a web shop of an EU merchant that has an domain extension of Member State A, but that is not a Member State A merchant.
The payment service provider is an EU acquirer (not from Member State A).
The Member State A’s Payment Services Provider (PSP) issuing the payment card charges the PSU a different amount in Member State A’s currency (different from the amount that has been authorised).
The difference between the original and charged amounts is caused by a currency conversion due to a card transactions settlement in another currency (EUR, USD, etc.) in the Payment Scheme.
- Background on the question
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Following the payment service users (PSUs)' complaints that, when authorising card payment transactions on a web shop with an domain extension of Member State A in the amount of, for example, currency A 100, the Payment Services Provider (PSP) issuing the payment card later charges the PSU a different amount (for example, Currency A 105).
The Member State A’s Competent Authority asked the PSPs for an explanation and received the following response from the industry:
This situation occurs with card payments on a web (internet) shop of an EU merchant that has a domain extension of Member State A, but that is not a Member State A merchant, where the payment service provider is another EU acquirer (not from Member State A).
At the moment of a card payment, the transaction is presented to the cardholder in the amount expressed in Member State A currency. This is the only amount and currency to which the cardholder gives consent at the point of sale, i.e., the “original currency” of such a transaction is Member State A’s currency.
This is also the amount and the currency that the foreign merchant submits for further processing and settlement with Payment Schemes.
However, the foreign merchant’s acquirer settles those card payment transactions with Payment Schemes in the chosen “settlement currency”, e.g., EUR, USD, etc. Such a settlement value is sent to card issuers.
The issuer receives the original and the settlement amount, as well as the currency. The billing amount and the currency for which the issuer charges the cardholders depend on the issuer’s regular cards’ foreign exchange set-up.
Some card issuers charge their cardholders in the original amount and currency, i.e., in Member State A currency. However, other issuers convert the received settlement amount to the HRK value, which is different from the original amount in Member State A currency (due to different exchange rates and dates applied by the issuer), i.e., cardholders are billed in the Member State A currency amount, which is different from the original Member State A currency amount to which they gave consent at the point of sale.
Since a foreign merchant and a foreign merchant’s acquirer participate in this chain, according to the industry's opinion, such cases are beyond the PSP issuers' control.
- Submission date
- Rejected publishing date
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- Rationale for rejection
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Please note that as part of adjustments to the Single Rulebook Q&A process, agreed by the EBA and the European Commission, it has been decided to reject outstanding questions submitted before 1 January 2020, when the Q&A process was updated as part of the last ESAs Review. In particular, the question that you have submitted has now regrettably been rejected and will not be addressed.
If you believe your question would still benefit from clarification, you are invited to resubmit your question, adapting it to reflect any legislative, regulatory or other relevant developments that may have occurred since the initial date of submission. The EBA will aim to address resubmitted questions as a matter of priority. When considering to resubmit, you are kindly requested to observe the updated admissibility criteria agreed in the context of the adjustment of the Q&A process, available in the Additional background and guidance for asking questions. We hope for your understanding.
For further information please refer to the press release and the updated Q&A page.
- Status
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Rejected question