Published on Monday, April 8, 2013

End to rip-off credit and debit card charges

A ban on rip-off debit and credit card charges came into force over the weekend, meaning airlines and other travel providers will no longer be able to charge customers any more than it costs them to process payments by plastic.

The government said that in many cases the surcharge for paying by Visa or Mastercard should be minimal.

For example, according to the Office of Fair Trading, someone spending £100 on a travel ticket could expect to be charged 53 pence extra if using a debit card, or £2.10 if using a credit card.

The figures, produced in 2011, suggest the cost of using a debit card remains at just over 50 pence, however large the transaction, said the BBC.

But the government said charges will differ according to individual businesses.

In the past, the airline industry was the worst offender, charging passenger up to £350m in card surcharges.

Following an investigation by the OFT, airlines agreed to include debit card charges in their headline prices, but some, including Ryanair, introduced an 'admin' fee. Ryanair has sinced introduced a 2% credit card surcharge in addition to its £6 admin fee.

The ferry industry was the next biggest user of surcharges, according to the government, charging its customers up to £145m.

People are entitled to receive a refund of the excess surcharge they have paid, according to the government. If necessary, they can bring a private claim to recover such surcharges.

Consumer affairs minister Jo Swinson told the BBC: "The practice of excessive payment surcharges has been ripping off consumers for far too long.

"They are fed up of thinking they will be paying a certain price for goods, only to find out towards the end of the process that the final price is much higher."

Very small businesses and start-up companies will not be subject to the rules until June 2014.

Some firms in financial services, gambling, healthcare, social services, property and passenger transport are also excluded.


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  • Consumer Rights Directive in the UK.

    The rest of the provisions of the Consumer Rights Directive will be passed into law later in 2013 and come into force by June 2014. This will see many of the companies currenty using 084 and 087 numbers for customer service and complaints, among other things, having to scrap these numbers and move to either the equivalent matching 034 or 037 number, or to a new 01, 02, 033 or 080 number. Additionally, companies that choose to carry on using 084 and 087 numbers will be required to declare the Service Charge that applies to their telephone number. This is likely to be of the form: "Calls to 084X XXX XXXX incur a Service Charge of X p/min. Your telephone provider will add their Access Charge." The Access Charge is currently 0p to 10p/min from landlines and 20p to 40p/min from mobiles. Phone companies will also have to declare this charge (rather than the total call price) from next year. This will see landline price lists reduce from thousands of price bands (based on the first six digits of the phone number) for call costs within each tariff, to a single Access Charge for each tariff. The price variation will remain in the Service Charge. It will be 1p to 7p/min for 084 numbers and up to 13p/min for 087 numbers and continue to be based on the first six digits of the telephone number. Users of 084 and 087 numbers will have to declare the Service Charge wherever their telephone number is advertised. Although this won't reduce the cost of calling these numbers, it will make it very clear that part of the cost of the telephone call is going to the organisation that you are calling.

    By Dave Anderson, Tuesday, May 7, 2013

  • Seperate fees please!

    In my part of the cworld, better for your customer & your business if CC fees are charged seperatly 1. Carry the CC fees in your retail and those who pay cash are paying for them (hence your price can be reduced without fees inclusion). 2. Include your CC fees and you customer is paying tax on it, charged seperatly and no tax.

    By john nicholls, Tuesday, April 16, 2013

  • It has taken far to long.

    It has taken far to long for this ban to come into effect, It is amazing how long they have been getting away with it. lets hope they get a class action lawsuit for what they have charged over the years. I hope the next ban is on charging passengers outrageous admin fees for claiming there APD refund.

    By tonywhite201 , Monday, April 8, 2013

  • Charging for card use is a bad business model

    Again. Charging to take payment with the only means actually accepted, is ludicrous. Of course accepting cards and paying fees associated, is, a cost of doing business. But...perhaps when the same companies start accepting payment in Bitcoins they will give a discount for a soaring currency versus the fast sinking currencies of today!

    By Roger Ellman, Monday, April 8, 2013

  • We don't

    We don't add on credit and debit card charges. It's a cost like any other of doing business so I find it disingenuous to claim you can separate it out and charge the clients. Glad to see it banned.

    By Daniel Wrightson, Monday, April 8, 2013

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