Dismay as PayPoint increases its monthly service fee by 3.6 per cent
Independent retailers have expressed extreme disappointment at the news that PayPoint’s monthly service fee is to rise from April.
Letters advising of the increase began arriving with PayPoint’s network of retailers on Friday 28th February.
The letters state that the rise has followed PayPoint’s annual review of its prices against the retail price index (RPI). It adds that on 19th February 2025, RPI stood at 3.6 per cent.
However, the move has been described as “extremely disappointing”, as it comes at a time when independent retailers are already facing unprecedented challenges.
Mo Razzaq, the Fed’s National President spoke of his disappointment at the increase, despite representations being made by the trade organisation.
“Fed members are being tested to the limits. Costs are rising, retail crime is at its highest levels yet and independent retailers are beset with red tape,” he said.
“In April, businesses are already facing the perfect storm of increases both to National Insurance Contributions and the National Minimum Wage. Now, they will have this increase from PayPoint to contend with.”
In 2022 and 2023 – and following discussions with Fed officials – although the payment specialist increased its service fee charge, it absorbed the additional costs caused by inflation to protect its network of retailers. Last year, the full increase was applied.
After being advised of the impending increase at a meeting with PayPoint last month, Fed officials asked the company to think again.
“It is a huge blow that although we raised the concerns of members with PayPoint, this appears to have fallen on deaf ears and, once again, the company is raising its monthly service fee in line with the RPI,” added Mo Razzaq.
“PayPoint needs to be aware that this move could have consequences, with some retailers now looking ever more closely at the feasibility of offering some of its services.”
