/ Money

Surcharge campaign: help us make a hat trick of successes

Three thumbs up

Before the summer break the OFT recommended government action on excessive surcharging. It’s nearly autumn and we’re as determined as ever to achieve our third and final goal – but we need your help.

With your help we convinced the OFT (Office of Fair Trading) that the surcharges companies charge for paying by card are often hidden and make it difficult to compare like-for-like when finding the best deal.

This is particularly true when it comes to flights. How do you know if you’re getting the best prices if you’re whacked with a £10 fee just as you get to the check-out?

Hooray for success one.

OFT enforcement action

The OFT recommended that companies make the headline price more meaningful for comparisons – including the surcharge cost upfront. It believes this would encourage competition between retailers, driving down the price of genuinely optional surcharges.

The OFT also recommended that the government introduce measures to prohibit retailers from surcharging for debit cards.

With your help, we convinced consumer affairs minster Ed Davey MP to encourage his European Counterparts to adopt a proposal in the Consumer Rights Directive. This means companies will be forced to limit the surcharge they add when you pay by card.

Hooray for success two.

Two years too late?

We were delighted when this legislation was passed, however, the Consumer Rights Directive will take two years to take effect. So, we’ve thought of a more ambitious plan B.

We’ve asked the Treasury’s Mark Hoban – the government’s financial secretary – if the Payment Services Regulations could be amended to ban surcharges. A change to the regs could ban surcharges on the most common payment methods – debit cards at present.

We’ve weighed up if it’s too cheeky to turn to our supporters again. But, you’ve helped us this far and we think you can do it again.

We need your help to make it a hat trick

Will you join us in challenging Mark Hoban to make the change? If you will, there’s just one simple step – add your email address to our letter and we’ll fire off an email to his inbox.

Here’s to a hat trick of successes for consumers and inbox full of emails for Mr Hoban when he returns to the Treasury next week!

Comments
Guest
Vanessa Stafford says:
1 September 2011

Yet another rip off for the consumers of rip of Britain. When will we ever get a fair deal by Banks or any Government, they really do not care.

Guest
Bob McLoughlin says:
1 September 2011

The result of the required dumping of card surcharges, will be increased prices to take in the loss to the suppliers. The increased prices will affect customers whatever the means of paying. I have never suffered because I pay either in cash, cheque or debit card, depending on the situation and the item(s) purchased.

Guest
David, St Helens says:
1 September 2011

Credit card companies charge a standard admin. fee without regard to the amount involved & it is that fee which I am happy to re-imburse. I resent the sliding scale of fees which money grabbing businesses inflict and I was horrified & deeply regret my compliance recently (under pressure from my wife who insisted on having the protection afforded by credit card companies when booking a holiday) on booking an £1800 holiday & paid a credit card charge of £42 as demanded by Thomson’s sliding scale. I regret using the credit card with its extornionate fee because there were enough funds in our current account to pay cash & if a holiday firm as big as TUI is going to go bust, then God help us! The way charges should be passed on is demonstrated by DVLA which charges £2.50 for using a credit card, regardless of the amount involved. Congratulations to the DVLA on its honest approach.

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Guest

You can always try and pay the deposit of at least £100 of it by credit card and the rest by the cheaper debit card.
This still gives you full CC protection.
The protection provided by paying by CC extends beyond the “going bust ” scenario and can be useful if you have any other dispute with the company.

Guest
Bob Valleley says:
1 September 2011

Why should any retailer be allowed to make a separate charge to the customer for the privilege of receiving their money. It is part of their costs of doing buiness and should be implicit within the price advertised for the goods or services supplied. Define the method of payment yes, but no separate charge.
I would like to include credit cards within this, but can see there can be other issues.

Guest
HAROLD HAZELL says:
2 September 2011

the retailer has to pay VISA or whoever for their service. Card companies employ thousands of staff and countless computers. These things have to be paid for. How else would they be able to run ? Take the 5 weeks credit and that saves you !

Guest
Joe Geekie says:
2 September 2011

We the poor punter so to speak own most of the banks through the bail out. though we helped the banks out they have revised everything that they do for us and put the prices/charges up (double whammy) they should not be able to put anything forward unless it is agreed with the owners.ie telling us we cant use other branch cash machines where in most cases they have to due to there being non where they live so have to travel many miles just to get some of there own money. the dealing with credit cards apr and charges is a joke. it does’nt matter what dealings we have with the banks today they will screw us good and proper. regulation they say. what regulation we say. we should also stop the top managers & Directors resigning for poor work the should be sacked with no bonuses or payoffs every other normal person who worked badly would be sacked.the list could go on and on. same for the Government to.

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Guest

Debit card charges – is there not a case for this being classed as a penalty charge (therefore unenforceable under common law)?

I ask, as it is well known that purchasing items using a debit card costs a matter of pennies to the business, yet some businesses have charges of over £2 per transaction.
To add weight to this, was the fact that assurances were made by the UK government at the time of introduction, that debit card purchases would incur no charge to the customer.
Perhaps if paying by a debit card was given a similar standing to legal tender, which in effect it is?

Credit card payment charges were, we were assured, to be chargeable at a maximum of £2.50 per transaction?
At least we can choose to take out a credit card or not, where as, most people have to use a bank account for bills, wage payments, etc.
The issue needs looking at urgently, especially as banks have started denying universal access to withdrawals from all cash machines.

I wonder if a return to wages payments in cash, instead of the favourable, everyone needs a bank account to live set up we have now, might just make big businesses/banks stop and think about the chance that they might lose significant custom?
As it stands it is a closed shop in favour of the banks whilst the people jump through hoops and pay through the nose.

Guest
lenrod says:
5 September 2011

I am not against paying the charge that the banks charge the companies, it is the rip off
that they charge us so much.
When using a debit card which is like using cash and then been told you are been charged
a helluve alot more for using your card.

Guest
Michael McCarthy says:
6 September 2011

Campaigning against these kinds of blatant abuses is like trying to empty the sea with a bucket. The problem is systemic. Capitalism is inherently a system under which the rich profiteer at the expense of everyone else. Outlaw one abuse and they’ll find another.
It’s a different economic system that we need, and a society where no-one has any more power tjan anyone else.

Guest

This is a very pessimistic view! Our financial environment would be truly awful today if people hadn’t campaigned against and outlawed hundreds of abuses over the last century or more, and this campaign is very valid and will have a very positive effect.

I remember years ago that the government was supposed to have outlawed the practice of advertising one price (particularly for flights) and then charging extra fees as you go through the booking/payment process, even though those fees could have been included up front.

Sadly this rule seems to have had little effect (or did I imagine it?) – last time I booked with RyanAir, there was even a charge at the end for ‘Administration’ – clicking on the ‘?’ button next to it led to an explanation like “This is to help cover our costs in administering the airline”.
Absolutely crazy – it would be like getting to the check-out in Tesco and being slapped with a five quid surcharge to cover staff costs, a tenner to cover building costs, etc.

I really hope Which will keep on the trail of this type of blatant abuse as well.

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Guest

According to our latest research Brits are still paying more than £265,000 per day in debit card surcharges to airlines, despite a ruling by the OFT that they should be banned. Please email Mark Hoban MP to stop this once and for all: http://www.which.co.uk/campaigns/personal-finance/card-surcharges/email-mark-hoban/

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Guest

emailed.

I think you should expand the campaign though to include all industries. Everything I have bought online recently (eg amazon) has incurred a surcharge. Especially concert tickets (booking fee + credit/debit card fee)

Cinema tickets too, which are stupidly expensive now anyway, are charging to book by cards. If you book online, how else are you supposed to pay?

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Guest

Hi Dean, our campaign is about all debit card surcharges, not just airlines. So your email to Mark Hoban will highlight every single industry that uses unfair surcharges. Today’s story about airlines was just to highlight how excessive these surcharges are in that particular industry. Thanks.

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Guest

Cool, the stories haven’t necessarily showed this as the headlines are usually related to airlines. Don’t get me wrong, they are the worst perpetrators, but the news that 2 airlines recently jacked up their surcharges, even with the OFT upholding the super-complaint, kind of serves as a 2 finger salute to Which? and consumers everywhere.

I am convinced of the effectiveness of the Which? campaign to the OFT, but not of the OFT to hand out punishments to the culprits. I am convinced they will find another way to fleece the customer regardless.

Guest
Peter Saliba says:
6 September 2011

I´m an ex-pat member of the C.A. having lived in Málaga since the depths of the Thatcher years in the mid 1980s. I´ve been trying to book an online “low cost” flight to Newcastle upon Tyne to be able to attend the Chartered Institute of Linguists´ Members´ Day in Durham on Sat. 17th Sept. next. The headline fares seem to be reasonable but by the time charges are added for a standard 20 kilo suitcase (which used to be free!), for allocating one´s own seat (that should be done by the airline staff) and then the coup de grace for these credit and debit card charges which are often over 40 GBP, you realise that “low cost” is in fact HIGH COST. EasyJet and Jet 2 airlines are the main ones with direct 3 hour return flights to Newcastle but with prices well over 500 GBP for my wife and I to fly there before booking expensive hotels, we´ve given up and opted instead for a half board apartment package deal in Tenerife for under €800 or just over 700 GBP! We paid CASH at a local travel agent´s and we´re each entitled to take a 20 kg suitcase for free.

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Guest

It particularly annoys me that I am charged up to £4.50 to buy currency with my own money from the Post Office. I used not to be charged when I had a Mastercard Debit card although I believe they now charge. But I was compulsorily transferred by my bank to Visa and cannot see why I have to pay a surcharge to buy currency but not for another similar payment to other shops. It’s yet another rip-off and I am forced to draw money out and walk round to the Post Office and pay in cash. That’s not the point of plastic!

Guest
Sheila says:
15 September 2011

I echo Peter’s frustration with’cheap flights’. Fare plus luggage plus paying extra for a seat – does this infer that you can choose to stand? Then taxes and fuel subsidy.
Flybe flights cost £245. Using bank debit card £265 or credit card £267.92. Ridiculous! Booking on the net how can you pay in cash? I thought direct debit was as good as cash. How can it cost £20 to transfer money between banks? Very tempting just to say no and drive to London from Newcastle. Let’s get this robbery fixed now.

Guest
zazoupazou says:
27 September 2011

Just booking flights with Jet2.com and shocked at the unvaoidable hidden charges. First off, they are still charging for debit cards – but they do this by breaking the charge in two i) payment card fee for for everthing but just two specific debit cards (solo and electron – which of course I don’t have). ii) booking fee – for all transactions (no way to avoid). So, in total I’m paying 7.2% extra for transaction charges. Does this reflect the true transaction costs?
The other fee is for checking in! How am I meant to fly without checking in? I can understand why they might want to offer savings for online booking but the cost of checking in at the airport is £18 per person but checking in online is still £5!
Obviously, they charge extra for luggage but I can sort of understand this – they need extra fuel for it.

Guest

Charging a booking fee for booking online is a blatant abuse – it would be like queueing up in Tesco and finding that there’s a checkout fee on top of the cost of your groceries!
All we need is tighter regulations to get all the fees posted up front, and included in the headline ticket price. How hard can that be?

To the people who say that the airlines will still charge us the same amount, that may be true, but at least we won’t get an annoying shock. And it will encourage real competition, which may mean that we won’t pay as much – these airlines can’t lure us to their sites so easily if they’re forced to advertise the full price on page 1.

Guest
Shuman says:
19 October 2011

I’ve just had to pay a fee of £12 to book a flight online with Thomas Cook. There are no scheduled flights to my destination so have no other option. How can they possibly justify this amount – I even have to print out my own tickets!

Guest
Shuman says:
19 October 2011

Re my last posting….I should add that I used a VISA Debit Card.

Guest
Ralph Nevin says:
24 October 2011

I’m in the same boat or in their case – plane. They charge £6.00 per person for Visa Debit Card, not £6.00 per transaction. So for a family of 4 the charge is £24.00 for one transaction. How can they justify that ??

Guest
AdrianL says:
26 October 2011

The raw costs of processing a debit card transaction are low. Handlers charge this to the retailer (credit card transactions will usually be more).

There is no justification in the retailer adding in an inflated charge for this service (some airlines will not accept cheques or cash as these cost them much more to handle). It is simply a way of quoting lower prices and then bumping up the final total!

However, Banks are guilty of adding on to the true cost of overseas card transactions as well!

A retired Bank Employee, who is ashamed of the profiteering by so many.

Guest
AdrianL says:
26 October 2011

Seeing the comments about CCA protection, note that if you have had your DEBIT CARD for some time, this may also be a Regulated Agreement under the terms of the CCA (was it 1985 – memory fails me). Look at your literature that came with the card and renewals.

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Guest

Now our banks are also charging the retailer extra when customers use “reward cards”. Surely it is another thing that should be stopped. Bet the big stores don’t get charged extra?

Guest
Hazel says:
23 December 2011

BT have been charging me £4.50 a quarter for a handling charge but I pay online and by debit card
I now know that the handling charge is about 20p its a rip off

Guest
David says:
23 December 2011

Not read the postings for some time but still smarting from paying extra £42 when paying Thomson nearly £5000 to take the family to Cyprus in September. Thought it was a funny amount but I can now see it was 7 x £6 (including 2 children) for just one transaction. This rip-off on top of the profit they made!

Guest
ashore says:
30 December 2011

This is good news really, but why wait until the end of 2012? It just gives the airlines a year to dream up ways of charging more on other things to replace the extortionate card fees. And they will !

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Guest

Ryanair are the biggest culprit in airlines and say their charge is an admin fee and not for using a card. Can this be allowed when there is no “admin fee” for using their own card that they have introduced recently?

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Guest

As Loz says, the airline booking or transaction charge is just as big a rip off as the card charge as both are unavoidable and should be included in the headline price.

However a bigger issue is the charge made by VISA. Every purchase made with a credit and most debit cards involve paying a percentage or fee to the same american bank. It doesn’t matter if it’s VISA or Mastercard or Switch or what name is on the card, every transaction involves payment to the american bank VISA. This is a monopoly situation that should never have been allowed and a drain on our econony that we cannot afford.

Guest
Emma Scobbie says:
2 January 2012

I have just booked with easyjet using a debit mastercard. However, their system does not recognise the card as a debit card and I can only book if I select credit card. this means I incurr a whopping £16 charge on top of my booking instead of the usual ripping me off £10 charge for a debit card. I have to take the flight so I still had to book. Is this an Easyjet dodge to get around the no charge for using a debit card by the end of 2012 ruling? Perhaps they have just put an intentional glich in their system that now does not recognise some debit cards so they get their ri[ off money anyway, knowing that only a very small percentage of people will complain. (One of those being me as I have sent my complaint). wondered if anyone else has come across this problem? Emma

Guest
Steve Walker says:
10 January 2012

Just tried to book with Ryanair, failed. I just discovered their latest ploy with payment methods, the use of their own pre-paid card. Then read the various blogs on the internet, and decided that its not a card for me. It is surely against any “fair trading” laws at the moment? And if not lets get some new ones passed ASAP. Its a card with the sole purpose of sneakily hiding crucial financial implications and very akin to the most disreputable schemes around.
I wonder, could customers of Ryanair show their disapproval with a “mass booking” day, not making any bookings, just clog their systems?

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Guest

I’ve recently paid my annual Management Fees to a holiday company. They employ the services of the First National Trust Company (FNTC) to process their credit and debit card payments. FNTC has introduced a new admin fee of 2.5% this year for payments made using Debit Cards. (Previously this charge was only applied to credit cards payments.) For me this new charge increased my costs by just over £54! I consider this new ‘admin charge’ as blatant profiteering by FNTC. Will FNTC come under the same new legislation as airline companies and companies selling tickets for entertainment events as has recently been announced by the Government for introduction later this year?

Guest
terry says:
19 January 2012

Its time that it is made illegal to impose charges for useing your credit card,there are no more admin chages than useind a debit card.The only reason is for retailers, companys impose charges is to make money out of us the public, another big big RIP OFF,time somthing is done now not later NOW.

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Guest

As I said in my previous post, Rynair continue to get away with calling their fee an “admin charge” yet no admin charge is made when using the Ryanair card. I have just paid £48 “admin fee” on 4 return flights. It is appalling that they are allowed to do this but millions of people book their flight(as I have just done!) so they will continue to get away with it. I don’t see how any new regulation is going to solve this

Guest
Jayne says:
25 January 2012

I have complained to the Capital FM Arena in Nottingham about their surcharge on Debit cards. I went to purchase two tickets for the Ice Hockey play-offs totalling £140 and was told i would have to pay £14 extra – 10%. I know these have to be processed and staff paid etc etc but isnt 10% a bit over the top when for that amount it would’nt have gone through if the money had not been available. I turned to the cash machine instead and paid £1.84 for taking the cash. The arena say they are quite within their rights to make such charges as they are a Ticket Agent ( for their own events???)

Guest
Roy Martin says:
29 January 2012

Recently my wife booked 24 tickets for a Scout and Guide gangshow at the Haymarket in Basingstoke, but had to book through the Anvil. Only when she went to pay was she told that there was a £1 PER TICKET charge. “This is not a card charge” she was told, but it didn’t apply if you paid by cheque or in cash! She sent a personal cheque, but was telephoned and told that they “only accept business cheques”! Fortunately, a cheque raised on our Scout account WAS accepted.

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Guest

What many don’t realise is that if charges are banned/restricted on the one hand, it can be got around by pushing up the prices for other things or making savings by cutting service quality. There are no ways around the laws of economics. The market (which are people) simply adjusts to compensate.

Guest
joe belfast says:
15 May 2012

just paid a tax bill to HMRC and then they took an extra £12.40 because I used a credit card