The National Bank of Serbia plans to amend the law on interchange fees so that card payments made in Serbia with cards issued abroad fall under the same cost ceiling as domestic cards issued by Serbian banks. The change is intended to address how interchange fees apply when foreign-issued cards are used at points of sale and for related withdrawals.
- Foreign card usage in Serbia and the scale of transactions
- How interchange fee caps affect merchant charges
- Alignment with EU-style structure for debit, credit and online payments
- Sectors likely affected by changes in foreign-card acceptance
- E-commerce exposure for cross-border sales
- Banks’ fee income considerations and potential pricing shifts
- Implementation factors including transaction types and reporting
- Broader context as Serbia modernises financial services
Since 2018, Serbia has capped interchange fees on domestic card transactions at 0.2% of the transaction value for debit cards and 0.3% for credit cards. Those limits reduced the regulated component of card-acceptance costs for Serbian merchants when customers used locally issued cards. The framework, however, did not fully cover foreign-issued cards used in Serbia.
As a result, domestic retailers, hotels, restaurants, petrol stations, online merchants and service providers have faced materially higher costs when tourists, diaspora visitors and foreign business travellers pay with cards issued abroad. The central bank’s proposal is aimed at closing this gap as service exports and tourism-related spending continue to grow.
Foreign card usage in Serbia and the scale of transactions
Central bank data reported in the Serbian press show that foreign-issued cards were used at Serbian POS terminals in 2025 to pay for goods and services worth RSD 211.26bn across about 59mn transactions. Foreign-card ATM withdrawals added another RSD 80.5bn across 3.3mn transactions.
The central bank said the issue has become visible across Serbia’s retail economy rather than remaining limited to a small part of payments activity. It was described as particularly relevant in Belgrade, Novi Sad, ski and spa destinations, border areas, fuel retail, hospitality, private healthcare, online services and premium consumption linked to foreign visitors.
The NBS characterises the problem as a double imbalance affecting both merchants and issuers. Serbian merchants pay more when foreign cards are used in Serbia, while Serbian card issuers earn lower fee income when Serbian cards are used abroad than foreign issuers earn when their cards are used domestically.
How interchange fee caps affect merchant charges
The NBS proposal focuses on interchange fees, but interchange is only one component of the merchant service charge. Merchants typically do not pay interchange fees directly to card issuers; instead they pay an acquiring fee to the bank or payment-service provider supplying POS terminals or payment gateways.
Within that acquiring charge are interchange fees, card-scheme fees and other operational or commercial costs. Lowering the interchange component does not remove all costs for merchants, but it reduces one important floor beneath the total merchant charge and can improve their negotiating position.
The NBS points to earlier results after the original 2018 law reduced domestic interchange fees. It previously reported that average contracted merchant charges fell from around 2% at the end of June 2018 to 1.06% by the end of the third quarter of 2021.
Alignment with EU-style structure for debit, credit and online payments
The planned reform is also designed to mirror an EU approach to fee ceilings. In Europe, consumer debit and credit card interchange fees have long been capped at 0.2% and 0.3%, respectively.
The EU framework differentiates inter-regional online transactions because card-not-present payments have a different risk and cost profile. Serbia’s planned online caps are 1.15% for debit cards and 1.5% for credit cards, separating physical POS payments from online transactions rather than treating all card payments identically.
Sectors likely affected by changes in foreign-card acceptance
The practical impact is expected to be strongest where foreign-card transactions are frequent and average ticket sizes matter. Sectors identified include hotels and short-stay accommodation, restaurants in tourist zones, rent-a-car companies, petrol stations on international corridors, luxury retail, private clinics, event organisers, e-commerce providers and travel-service platforms.
The NBS also highlighted that smaller businesses may face greater pressure from higher acceptance costs because they have less bargaining power with acquiring banks and payment processors than large retail chains or hotel groups. For smaller operators such as family hotels, restaurants and specialised shops, a regulated cap on the interchange component is described as providing a stronger base for negotiation.
E-commerce exposure for cross-border sales
The central bank said similar logic applies to e-commerce and digital services sold to foreign customers from Serbia. Online merchants face higher payment-processing costs alongside fraud-management requirements and chargeback risks.
The planned online caps of 1.15% for debit cards and 1.5% for credit cards set a ceiling for online debit- and credit-card transactions even though they do not make online acceptance as cheap as physical POS payments. The NBS linked this structure to predictability for exporters operating from Serbia across software services, digital products, online retail, booking platforms, education services and creative industries.
Banks’ fee income considerations and potential pricing shifts
The reform may be less favourable for banks and card networks because interchange-fee income ultimately flows to card issuers while acquirers compete around broader merchant-service charges. Lower regulated fees reduce one revenue channel that banks rely on within their payments-related income streams.
The NBS acknowledged that risk but argued that Serbia is importing levels already accepted in a major regulated market rather than creating an isolated domestic experiment. It said this leaves less room for claims that Serbia’s cap would be commercially unworkable or unreasonable.
Implementation factors including transaction types and reporting
The final legal wording will be important for how different arrangements are treated under the amended rules. Key implementation questions include treatment of commercial cards, three-party schemes, card-not-present transactions, cross-border acquiring models and reporting obligations imposed on payment-service providers.
The central bank said enforcement will matter as much as the cap itself because benefits could be diluted if banks or processors compensate through increased opaque ancillary charges. It also stated that clearer information provided to merchants about fee components can support competition among acquirers.
Broader context as Serbia modernises financial services
The reform comes as Serbia faces pressure to modernise financial services and align more closely with European standards. The NBS described payments regulation as one of the more practical areas of convergence because it affects consumers and businesses directly through cash registers and online checkouts.
The central bank also tied its move to tourism growth expectations by noting that foreign-card acceptance functions as part of tourism competitiveness where foreign visitors pay hotel bills, restaurant bills or retail purchases in Serbia using cards issued abroad . It said extending interchange-fee caps is intended to ensure tourism-related service exports do not become a high-fee corridor within card acceptance arrangements .
