Residents may encounter such situations when shopping online, paying for parking via an app, settling bills in a café through a QR code, or paying for public and other services.
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“A consumer comes to buy a product or service and should not have to pay extra for the payment method chosen by the merchant. Situations are especially unacceptable when a person already pays their bank or another service provider for payment services, for example, has a payment services package, but when making a specific payment, has to pay again,” says Evaldas Ruzgys, a member of the Board of the Bank of Lithuania.
He emphasized that the Bank of Lithuania views unfavorably the practices existing in the market and newly emerging business models under which the consumer has to pay for the payment method chosen by the payee, i.e., the merchant.
When a merchant offers the option to pay by payment card, the payment acceptance service is provided by the payment service provider chosen by the merchant. According to applicable laws, the merchant must pay for this service, and these costs cannot be passed on to the buyer as an additional fee for card payment.
Many merchants, when accepting payments online or via smart device apps, redirect the user to their online banking to initiate and confirm the payment. This is the so-called payment initiation service (PIS), provided by the payment service provider chosen by the merchant, also called a payment intermediary. Laws do not prohibit the PIS provider from charging the user a fee.
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However, the intermediary is chosen by the merchant to conveniently collect payments for their goods or services. According to the Bank of Lithuania, merchants should consider payment acceptance costs as part of their business expenses and take them into account when setting prices for goods or services, rather than passing them on to the consumer who chooses a specific payment method.
This would comply with the principle enshrined in laws that both the buyer and the seller pay only their own payment service provider for the payment execution. Nevertheless, if a fee is applied to the user for PIS, the user must be clearly informed about it in advance and have the option to choose another payment method that does not incur additional costs.
The Bank of Lithuania urges residents to check before confirming a payment whether an additional fee related to the chosen payment method is added to the price of the product or service. Not all payment methods must always be free, but the merchant must inform the consumer in advance about additional fees and provide a real opportunity to choose another payment method that does not require extra payment.
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