The death of the rip-off card surcharge

Businesses will just up their prices to compensate for any lost income from card charges.

Yes, airlines and insurance companies add fees regularly!

The government itself does exactly this by charging for credit card use when paying for car tax

I agree with Alan Francis, the EU directive should have insisted the banks reduce their charge in line with the charge for debit cards which is 20p – 30p per transaction, that would keep the consumer and the business owners happy. The banks are already making a healthy profit on credit cards by charging their clients 16% – 35% and more sometimes.

DVLA won’t even accept debit cards over the phone so a credit card with surcharge is only way available-to make life easier!!

The current arrangement sees the card processing fee specified as a separate and transparent cost. Treasury rules limited the retail charge to no more than the actual cost incurred in processing the payment.

In future, the card processing charge will now be built into the cost of goods and services purchased. Those who pay by cash will be subsidising this.

Presumably retailers and traders will no longer be able to offer a cheaper deal for cash?

Dear Lauren,
While the banning of charges for use of credit and debit cards is good news, perhaps now you can turn your attentions the the diabolical costs of taking debit and credit card payments levied by the banks on businesses.
I own a bar in London. Only the one, not a chain, and the charges we have to pay for accepting credit and debit cards is seriously impacting our ability to survive.
In the last 2 years we have seen credit/debit card payments leap from 20% of our takings to 70% of our takings. As a result, we have had to rent an extra card machine for £50 a month. This takes our card machine rental up to £1200 a year.
Then there are the costs levied against us by the banks for accepting these payments. These range from 30p per transaction for some cards to 3.5% of the total transaction for others, and it is costing us thousands of pounds a year, when we do not have thousands of pounds a year to loose.
We have to accept card payments, but why should the banks now profit from my hard work, when I barely profit myself?
It was already bad enough when I was mostly working to pay insane amounts of rent, business rates and taxes. Now I’m working for the bank too, and it’s diabolical.
People complain that small businesses are disappearing and the high street is being taken over by corporations and chains, but as long as people choose to use credit/debit cards in stead of cash, and as long as banks are allowed to charge these rip off fees, small businesses will continue to disappear until there will be nothing but faceless chains and corporations left, and then we will all be poorer.
So far, we have not added a charge for using credit/debit cards, but if my bar is to remain viable, I have no choice but to increase the price of my drinks. The end result of that is that I loose and my customers loose, but the banks win.
If you want to help customers and small businesses, please campaign to end the banks right to steal my profit just because customers are to lazy to go to a cashpoint machine.

When I order home heating oil or pay for car or house insurance I am always charged for using a credit card but not a debit card.

Unfortunately, Section 75 doesn’t always apply. I booked a holiday at a “Hotel and Spa” in Ireland that I’d stayed at before, only to find that the leisure centre/spa had been closed down since booking. The hotel refused to take responsibility for their failure to notify me so I tried to claim under Section 75, only to find that the protection does not apply when using a credit card to pay a third party – the booking agent. That business is based in Brussels and their terms and conditions also prevented my refund.
I always pay by credit card for anything costing more than £100 in the expectation that if things do go wrong, I’m not out of pocket; but bear in mind there are gaping gaps in this protection.

This is not a victory for small business, at all. We pass on the, ridiculous, charges that are levied at us from those who wish to use a credit card – By all means, enjoy your air miles, free insurance, cash back etc but don’t expect it to be free! We swallow the debit card charges and accept cash and bank transfers.

This move could cost us over 10k-20k a year which we will need to pass on in some way or another. Many businesses will need to do the same.

Does this ban apply to those outside the EU – Are we able to apply a surcharge to somebody with a US card, for example? I’ve tried to read the legislation but quite seem to find a definitive answer..

I am a bit late, but this is excellent news.

A few weeks ago we were going to buy something over the internet. It had been on a very good special offer but we missed out but decided to buy it anyway. When we went to pay, they were going to add 3% CC charge. To cut a long story short, to avoid paying the charge, they added on £40 delivery charge. We did not complete the transaction.

Ban on debit card surcharges – will this apply over the counter in shops and taxis? My local shops charge 50p, one pound or more, and minicabs charge £2 on top of the £6 minimum fare, to go 500 yards.

Sadly the wording of the UK legislation produced in response to the EU Directive is too wooly and weak, and there is no indication of who will police the requirements, or how they will do so.
I am certain that the majority of organisations that apply such card surcharges will merely change the name to “booking fee” “service charge” etc, or else raise their prices to include it.
Organisations such as HMRC and other bodies will continue to charge and argue that the requirements do not apply to them.

Will this apply to airline booking charges where a surcharge is added for paying by credit card?

A deeply flawed proposal from the EU, similar to the flawed decisions on car/co2 emissions, once again politicians have chosen the quick fix that will satisfy no one and achieve nothing. We all know that the primary culprits of rip off fees were the Companies that wish to show a low fee on there sales, and then load the supplementary fees, Holiday Companies and Low Cost Airlines being the prime candidates. Businesses have to pay fees to take cards, that will not end. The end result will be that all consumers will now pay an extra cost to cover these fees. I am advising my clients that except cards to commence charging an admin fee on all sales.

I have just paid the balance on my package holiday, and had to use a debit card payment. The travel company will only accept debit card payments now that the credit card surcharge has been banned. I think this will become standard practice with all kinds of smaller retailers, and thus we, the consumers will be worse off, because we lose the financial protection afforded by credit card payments.
This is a poor piece of legislation, removing a fee, but as a result removing an important consumer protection. Did our legislators, and the organisations who campaigned for it, includng CA, not see this coming?