While this change may seem trivial, it can still have an impact on consumers at checkout. Indeed, the fees applied to each transaction can vary depending on the payment network used, forcing merchants to pass the cost on to the end customer.
What does the CB logo on a bank card mean?
The CB logo is the emblem of the French banking network of the same name, the CB network. It was created in 1985 by the Groupement des Cartes Bancaires, an economic interest group bringing together most French banks. This network is important because it ensures interbanking: this is what allows bank cards issued by participating banks to be accepted by all payment terminals and ATMs affiliated with the network. Without this, a card from bank X would not necessarily be accepted at a merchant affiliated with bank Y.
Mastercard and Visa: for international use, but not only
The vast majority of bank cards issued in France are “co-badged.” That is, they carry both the CB logo and the Visa or Mastercard logo. The main reason for this is the card’s use abroad. Since the CB network is only national, card transactions outside of France will automatically be processed by Mastercard or Visa.
There are other situations in which the CB network will be overlooked in favor of Mastercard or Visa. For example, a foreign card used in France will have its transactions processed on an international network and not on the CB network. For certain online payments, particularly on foreign sites, the consumer may be required to choose between Visa and Mastercard, without having the option of using CB. Some French online banks and other foreign-based fintechs also offer cards not affiliated with the CB network.
Towards the end of co-badging?
Since 2020, the share of transactions made via the CB network has been steadily declining. This share has fallen from 95% to 85% in just 4 years. This decline is due to the rise in online payments, but also to the rise of neobanks and payment cards issued by institutions not part of the Groupement des cartes bancaire (Bank Card Group). These banks, sometimes foreign, issue cards without co-badging, which can only be used on the Visa and Mastercard networks.
A potential impact on consumer prices
The CB network, renowned for its low costs, is a pillar of the French payment system. Its abandonment in favor of international networks like Visa and Mastercard could lead to higher fees for merchants, and potentially higher consumer prices.
First of all, it's important to remember that the CB network is a non-profit interest group that provides participating banks with an efficient and inexpensive infrastructure to manage transactions. In addition to independence from other networks and a certain control over the operation of the CB network, banks benefit from lower interchange fees than on international networks. For their part, Visa and Mastercard are private companies listed on the stock exchange. Banks are not members of their networks; they are in fact their customers and must pay fees for network use.
In the European Union, interchange fees are capped. They range from 0.2 to 0.3%. However, these fees are not the only ones at play. Network fees are much higher for Visa and Mastercard, making transactions more expensive on these networks. With higher total commissions at Visa and Mastercard, the bank can choose to increase its own commissions on the use of payment terminals, thus encouraging merchants to pass these costs on to the end consumer.
Business leaders sound the alarm
In 2023, some major retailers wanted to react to this gradual change. On X, Dominique Schelcher noted that fewer and fewer cards have the CB logo, and that the impact on prices is real. According to him, transactions via Visa and Mastercard can cost up to 10 times more in some cases, and small merchants are the most affected.
The Bank Card Group reacts
Faced with the increase in the issuance of “Visa only” and “Mastercard only” cards, the Group wants to bring its members back to its network. Indeed, some banks, although members of the Group, are putting non-co-badged cards into circulation. This is the case, for example, of Société Générale, which offers a Visa card through its online bank BoursoBank without offering the CB network.
The bank card group benefits from the support of the CNMP (National Committee for Payment Methods). The latter recently unveiled a new national strategy for payments through to 2030, with an emphasis on sovereignty. The Committee plans to “work towards the strategic autonomy of the French and European payments market” by continuing to rely on solutions such as the national CB network. This proximity to institutions will give CB a considerable advantage in maintaining its position as the leader in payments in France.
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