The National Federation of Retail Newsagents (NFRN) is urging retailers to contact their MPs to raise concerns about PayPoint in Parliament, although it is yet to make a formal complaint on the matter.

The NFRN has provided a template letter to its 9,000 members who operate terminals in order to encourage them to write to their MPs. It wants MPs to ask questions in Parliament about PayPoint’s decision to reduce the cap on retailers’ commissions.

Mo Razzaq, of Premier Mo’s and Family Shopper in Blantyre, Scotland, said he had already contacted his MP, Margaret Ferrier, who had promised to raise a question in Parliament on PayPoint. He said he was also talking to his local council who was supporting him in seeking a fairer deal in the future.

The NFRN announced on 12 May that it would make a formal complaint to the Payment Systems Regulator - a subsidiary of the Financial Conduct Authority. The group is yet to make the complaint but a spokeswoman said it was “exploring every avenue”.

Its template letter warns MPs that many retailers are considering removing terminals from their stores, denying vulnerable and elderly customers the opportunity to pay bills, top up keys for their electricity or gas meters or pick up their benefits.

The letter concludes: “As PayPoint is contracted to provide services on behalf of the government, I and independent retailers across your constituency would be grateful if you could raise a question in the House as to whether the government supports PayPoint in expecting retailers to subsidise the provision of its services.”

NFRN national president Ralph Patel said: “Independent retailers play a vital role in ensuring consumers have access to over the counter payment and collection services but it is inconceivable that they are expected to operate these at a loss.

“That’s why we want PayPoint retailers to contact their MPs and make them aware that such an abuse of retailers is not acceptable. To assist, we have provided a template letter.”