Success! OFT agrees ‘rip off’ surcharges are unfair
As People Power week’s under way, what perfect timing to reveal that your help has resulted in a consumer victory! We have exciting news about our surcharges campaign – and we couldn’t have done it without you.
The Office of Fair Trading (OFT) announced today that it too agrees with our surcharges super complaint.
It’s provided its recommendations for a short and long-term solution to the issue of excessive card surcharges. The quick win is price transparency.
Publish transparent prices
The OFT will be cracking down on companies that make it difficult to work out the true cost of purchasing something when paying by debit or credit card.
We’ve found that some websites will take you two or three pages in before explaining that paying by credit card will seriously bump up the price. In fact, some have left it until the final stages of checkout before adding in this ever so important detail.
Many of you have told us that it’s not so much the price, but the sneaky way these surcharges are added on when you’ve little choice to turn back that really irritates them.
Don’t drag your feet
Well the OFT’s response, and plans for enforcement action, should put a stop to this. But our message to companies – particularly those ‘no frills’ airlines – is why wait for the OFT to take action? If you know you’ll get rapped in the upcoming months, do it now and declare the costs upfront.
But what about addressing the excessiveness of the surcharge? Who’s going to fix that? Essentially, we need legislation to bring these costs back into line.
You’ve been helping us lobby Ed Davey, the UK consumer affairs minister, to support the Consumer Rights Directive (CRD), which includes a proposed ban of excessive surcharging.
2,400 emails to Ed Davey
We accept that there will likely be a charge for paying by credit card, but this should be a fair charge – up to 2% of the amount you’re paying. And as far as debit cards, since it only costs the retailer around 20p, there shouldn’t really be a charge at all.
2,400 of you felt the same and took to your keyboard to tailor our template email. Ed Davey took note as he wrote to our chief executive to share his concerns.
I feel strongly that your emails helped convince the minister, and in turn his European counterparts, to keep the proposed ban in the legislation.
The changes to the CRD will take a couple of years to come into affect, but this is the part of the law that could force companies to make surcharges cost reflective.
Another proposal from the OFT recommends an amendment to the Payment Service Regulations to force companies, by law, to be honest about their pricing.
So will companies take note and get into shape before the law forces them to? Anyone care to bet on the companies that may lag behind? For now, lets rejoice in the news that together we’ve successfully made the case that excessive surcharges are too big to leave untouched.
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