/ Money

Your help makes companies act on rip-off surcharges

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We’ve been overwhelmed by your support for our surcharges campaign, which brought about a ban on excessive charges. And now five companies are changing their rules due to your reports…

Most of you know this story well. In 2011 we issued a super complaint to the Office of Fair Trading over the excessive surcharges some companies charge you for paying by card.

You signed your names, emailed a Member of European Parliament and hassled the Treasury to take action. And take action they did by passing a law banning companies from charging you more than it costs them to process a card transaction.

But since the ban came into force you’ve caught some companies we believe to be flouting the rules. The good news is that First Choice, Thomson, EasyJet and Mytrainticket have all agreed to reduce their credit card fees after our you reported them. And EasyCar has gone even further by completely abolishing its fees for credit and debit cards.

Kay’s chuffed First Choice changed its rules

Kay booked a holiday with First Choice and ended up paying £56.25p to pay by credit card. She always books her holiday with a credit card so that she can have the protection of the card company. Kay told us about a previous experience:

Kay‘The holiday company I was using went into liquidation and I lost my money. Therefore we do not feel that we have any choice but to pay the credit card administration fee which we have always felt was rather high.’

She then told us her reaction to First Choice changing its rules:

‘I was surprised to read an article in Which? magazine advising that it might not be lawful to charge such an amount. I reported the details using Which?’s online tool. Which? contacted me to say that they challenged First Choice and the fee is going to be reduced. We are very happy with this result as holidays work out expensive enough as it is!’

But sadly it’s not all good news. There are a number of companies who we believe still aren’t playing fair. But don’t worry, eDreams, EasyBus, Vueling, Monarch, Jet2 and Germanwings are all on our hit list and we’re now referring them to Trading Standards to enforce the rules.

A huge thank you to all who have brought these charges to our attention – please keep reporting them with our tool and help us take action.


I have discovered that many local authorities are similarly breaching the Consumer Rights (Payment Surcharges) Regulations 2012 for payments by credit card for on-street parking. Many councils contract out payments by credit card for parking to Park-Mobile (UK) Limited, which also operates under the RinGo brand name. Parkmobile adds a 20p surcharge for payments by card. This surcharge breaches Regulation 4 of the Consumer Rights (Payment Surcharges) Regulations 2012 which states “A trader must not charge consumers, in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of that means“. It costs a percentage (typically 1% to 2%) to collect payment by credit card. In all cases, this percentage will be less than the substantial cost of collecting payment by coins. Therefore if there is to be a price difference between payment by coins and credit card, there should be a discount for paying by credit card; a surcharge breaches the Regulations.

The Department for Business, Innovation and Skills has published detailed guidance on the Regulations which explains that Trading Standards have responsibility for enforcement. At the top of page 5 of the guidance, it is stated that car parking offered by local authorities is included within the scope of the Regulations. Although Regulation 5(j) excludes “automatic vending machines” from the Regulations, the breach occurs where such a machine is not used because Parkmobile processes payments by telephone or smartphone app.

Parkmobile claims that the 20p fee is a “convenience fee”. However, it is not relevant what the fee is called but whether or not it is dependent on the means of payment. For example, Ryanair called its £6 debit card surcharge an “admin fee”, which ceased because it would breach the Regulations. Likewise this 20p “convenience fee” breaches the Regulations.

It is immaterial that local authorities contract out processing of card payments to an external company, even if it chooses to process cash payments in-house. Either Parkmobile’s processing fees must be paid and absorbed by local authorities or the costs of all payment methods must be added to advertised parking charges. It is not permissible under the Consumer Rights (Payment Surcharges) Regulations 2012 to surcharge for one payment method and not for another where the surcharged payment method is less costly.

It is immaterial that local authorities do not receive this payment surcharge, because they are the suppliers of the service and responsible for ensuring that any payment surcharges comply with the Consumer Rights (Payment Surcharges) Regulations 2012.

20p might sound like a small amount of money, but it is a hefty 20% surcharge on a typical £1 parking charge and in aggregate the amounts are huge. Trading Standards within local authorities seem reluctant to take action against their colleagues in their parking departments; there is a conflict of interest here. I have consulted Which Legal Service, who confirmed that the surcharge is a breach of the Regulations. Perhaps Which can put pressure on Trading Standards to take action across the country.


Another remaining culprit is mobile phone networks. Although the Regulations don’t apply to contracts started before 6th April 2013, the mobile networks are charging around £3.50 per month if the customer pays by any means other than direct debit, even bank transfer, irrespective of when the contract started. Even with a business bank account, it costs nothing to receive an electronic payment from within the UK.

As stated on page 12 of BIS’s guidance (see my post above), a business cannot take into account general administrative overheads. Therefore if it has to spend more time chasing customers who pay by bank transfer compared to direct debit, it cannot take these costs into account in its surcharges. It can use only the cost of the payment itself, not any difference in the general overheads of servicing each category of customer.

The same is true of gas and electricity suppliers, but that one is more complicated because the payment frequency is different for payment by direct debit.

mwwilson says:
7 October 2013

BT have an infinite payment surcharge for landlines.

If you are in credit (eg pay in advance of the bill), and so owe them nothing, you still get hit with a payment processing fee of £6.00 for not having a direct debit in place to not pay them anything.

The same fee is levied for paying nothing, BACS transfers as debit card, credit cards and cheques in the post which is clearly incorrect.


That is outrageous. Do they still add this surcharge if there is a direct debit in place but you don’t owe them anything? How do they know that the direct debit is cancelled when you don’t owe them anything?

mwwilson says:
12 October 2013

Probably not, but as I won’t trust them with a direct debit I don’t know.

It is essentially a ‘direct debit refusenik’ penalty charge.


I’ve tried reporting a surcharge twice on different days including today, and I just get an error message saying “We are unable to display this action, our trained lemmings are investigating the issue, thank you for your patience“.


Somebody should be looking very closely at SUNMASTER.CO.UK.
They have charged me 1.5%for paying by debit card.. And
Offer one price on the website, but confirm your booking by phone, which by then your flight has unfortunately gone up in price…
Accepted my booking for the hotel that was actually closing before my holiday dates… Wouldn’t let me choose my own alternative or have a refund…. Then charged me for the alteration that was their fault! In the end, I have paid roughly £300+ extra to the price when booked online.
Needless to say I won’t be booking with them ever again and duly warn people to beware when they are buying through them.

Richard says:
12 October 2013

There is an entertainments venue near where I live, called Anvil Arts. They have been charging a £1.00 booking fee per ticket when you pay by card, for quite sometime now. If you paid by cash at the counter however, you would not be charged the booking fee.

However they recently changed their minds on this. Every ticket purchased is now subject to the astronomical £1.00 charge, even if you pay with cash in person.

I think this is totally wrong and don’t think they should be getting away with it. I mean is it legal to charge a transaction fee if you pay by cash anyway?

The company have basically given a load of old rubbish about why they have to do this, but it doesn’t wash with me and a few other people it seems. Somebody has already hit out about this, in my local paper.