What exactly is everything else?

Dominic Thomas
March 2026 • 3 min read

What exactly is everything else?

You will probably have seen the adverts by Mastercard – for everything else, well it’s worth considering if there is anything else. We live in strange times, when our allies are behaving like enemies and our politicians are cow-towing to extremism or simply lacking any spine to stand against it.

The UK banking system relies heavily on both VISA and Mastercard, who run about 95% of payment systems. This reliance on a now unreliable system located in the US, with a President who is plainly idiotic and may order the system be “turned off”. It would seem that whilst both VISA and Mastercard are reassuring the UK of their commitment here and that they even welcome competition, we have seen how quickly US companies capitulate to Trump’s threats, putting up as much resistance as wet tissue paper.

I am sure you have observed the growing number of retailers that simply do not accept cash payments anymore. According to the market review (March 2025) in 2023 a whopping 61% of all transactions were using cards, which was 86% of their total value. There are countless adverts for payment machines and the push to Apple pay – which still really relies on the credibility of your original card. The LINK system is the UK’s ATM service to Building Societies and of course we can all do bank to bank payments.

It stands to reason that card payment systems help keep the economy ticking over and working smoothly, it also explains some of the inbuilt inflationary pressures with their additional cut being taken on each of those transactions. The cost of processing is something that many businesses complain about – which costs UK businesses around £170 million more than it did 7 years ago (despite the “competition”). The research unsurprisingly concluded that VISA and Mastercard were making profits substantially above normal profit margins of competitive markets, in essence it’s a cartel of two and another example of capitalism in the extreme.

The UK and European banking system is working on alternatives, the UK somewhat slowly and of course this isn’t helped by our departure from the EU. It is likely that solutions will be derived from digital currency, stablecoin, which offers up its own challenges.

It may be worthwhile reflecting on some of your purchases when shopping online or on the high street about how your money currently moves from your account to the retailer and begin considering your own alternatives. The Government to its credit, at least has a vision for payments.

For your amusement (or mine) here is the clip from Superman 3 (1983) directed by Richard Lester where Gus Gorman (Richard Pryor) an IT hacker, learns of the rounding down that banks do. I like to think that the Banks watched this and did it themselves.

References:

PSR Market Report March 2025: https://www.psr.org.uk/publications/market-reviews/mr22110-market-review-of-card-scheme-and-processing-fees-final-report/

UK Payments Plan vision: https://www.gov.uk/email/subscriptions/single-page/new?topic_id=payments-forward-plan

VISA – Annual report: https://annualreport.visa.com/home/default.aspx

Mastercard Annual Report: https://investor.mastercard.com/financials-and-sec-filings/annual-reports-and-proxy/default.aspx

What is Stablecoin? (Bank of England): https://www.bankofengland.co.uk/explainers/what-are-stablecoins-and-how-do-they-work

Superman 3: https://www.imdb.com/title/tt0086393/?ref_=nm_knf_t_1

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BANKS HAVE TO DO BETTER FOR FRAUD VICTIMS

TODAY’S BLOG

BANKS MUST DO BETTER FOR FRAUD VICTIMS

The Financial Ombudsman Service, which manages disputes between financial firms and customers, is ruling against banks in 73% of authorised fraud cases, data exclusively obtained by Which? demonstrates. This means if you have been tricked into sending money to a scammer, you may be able to get a refund from your bank.

The biggest banks are signed up to the voluntary Contingent Reimbursement Model (CRM) Code, which is designed so victims of authorised push payment fraud (APP) are treated fairly and consistently when they ask for compensation. If your bank refuses compensation, you can escalate your case to the Financial Ombudsman Service (FOS).

But the number of customer complaints about banks’ handling of authorised fraud – the vast majority of which are APP – landing at the FOS more than doubled in the 2020-21 financial year, from 3,600 to 7,770. And three-quarters (73%) of these were upheld in favour of the customer.

VAST SUMS OF FRAUD – SOMEONE HAS TO PAY

APP fraud – being tricked into transferring money to a fraudster – is fast becoming one of the UK’s biggest frauds. Losses hit £355.3m between January and July, outstripping losses to card fraud. Banks are required to refund you for losses to unauthorised fraud such as card fraud, but not APP fraud. You will have noticed that we ran a couple of items in our client magazine Spotlight about fraud and scams.

The voluntary CRM code was launched in May 2019 and requires signatory banks to provide effective warnings to customers, identifying vulnerable customers and acting quickly when a scam is reported. In return, you are expected to pay attention to take care, have a reasonable basis for believing the payment is genuine, and pay attention to warnings.

Crucially, signatory banks must reimburse customers even if both parties have done nothing wrong. Data shows that many victims have been wrongly denied compensation but haven’t approached the FOS. Escalating a complaint to the FOS is free, and can be done online, but not all victims will be aware of or able to use the service. That’s why Which? wants the government to swiftly take the necessary action to enable the Payment Systems Regulator (PSR) to introduce mandatory APP fraud reimbursement for all firms using Faster Payments.

If I were a betting man, (which I am not) I would conclude that Banks will find a way to recoup some of their costs from customers, this normally takes the form of higher interest rates or charges on all forms of borrowing. Alternatively, to end the myth of “free banking”. There is no such thing and its about time we all had a grown-up conversation about it.

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email [email protected]

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