What will this mean for you — Surcharge card ban

Lloyd Doyle
January 13, 2018

The Consumer Council wants to remind consumers that from today, Saturday 13 January 2018, businesses can no longer apply an additional charge (surcharge) to your order when you pay by debit or credit card.

"However, it may be that we see the amount that used to be charged in credit card fees popping up elsewhere, for example in booking or transaction fees, or even in the price of goods or services".

The surcharges have been commonly added by businesses ranging from takeaway apps to global airlines on customers who pay by card or use other services such as PayPal. Credit cards offer greater protection for purchases of single items costing over £100 up to £30,000 as the credit card provider must by law help get your money back if problems arise.

"As we build a fairer society, this added transparency ensures buyers can make informed choices about how they spend their hard-earned money".

One organisation to implement such a change is HM Revenue and Customs (HMRC), which will no longer accept payments by credit card as of today.

There are also fears that some organisations will stop accepting certain card payments altogether or to implement minimum spends for customers paying by card.

Consumer groups have welcomed the move but shoppers are also warned against retailers pushing up prices to offset the change.

Takeaway company Just Eat has introduced a 50p "service charge" after previously levying a 50p surcharge on card payments.

Gareth Shaw, from Which?

Some companies are however, already looking for ways to get around the ban such as simply renaming the fee so that any reference to cards is avoided.

Money, said: "The Government and regulator need to closely monitor the effectiveness of the ban - and the fees banks charge retailers for card payments - to ensure that it has the positive impact for consumers originally intended".

Up until now, firms were allowed to pass the costs of processing a card payment on to their customers.

Cherry added: "The interchange fees demanded by card companies are only the start of the costs that small firms incur when they process a card payment".

It will affect only people who actively give their consent to firms and follows a finding by competition authorities in 2016 that older and larger banks did not have to compete hard enough for customers and many people paid more than they should for their accounts.

Other reports by Iphone Fresh

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