The Scottish Grocers’ Federation and PayPoint have teamed up to tackle concerns over reduced caps on commission rates.

The federation this afternoon announced plans to work with PayPoint to devise a range of discounted services for SGF members, including preferential banking arrangements.

SGF chief executive Pete Cheema described the union as a “natural move”, as both are already trying to help retailers reduce their costs.

“I am hoping to finalise a package of services for SGF members, both with PayPoint and one of the banks, in the very near future,” he said.

“The SGF already offers its members a number of excellent deals that help to reduce their costs and add value to their businesses. PayPoint has always taken a very similar approach to providing support services to assist retailers in its network, such as its special account with Barclays.”

The two organisations have confirmed that they are currently in discussions with a number of banks.

The decision to work together follows the announcement that retailers will have their margins capped on utility transactions. Retailers across the UK have taken action against the cuts by calling for a boycott against the company, or by charging customers a handling cost if they solely use the service.

PayPoint spoke to Better Retailing about the decision and claimed that it was due to tough negotiations that has caused the cap. The NFRN is mounting a legal case against PayPoint following the announcement.