/ Money, Travel & Leisure

Excessive card surcharges need to stop now, not in 2013

We celebrated when the government pledged to ban ‘rip-off’ card charges in response to our campaign. But some companies have increased or introduced surcharges in a bid to rake in cash while they still can.

The ban doesn’t come in until the end of the year, but Which? wants companies to scrap these unfair and excessive charges now.

To be in business, you need to take customers’ money one way or another, but processing cards should be considered a regular cost of running the company. If firms wish to charge those who pay by credit card extra, the fees should reflect the true cost to the business, rather than being used to squeeze extra profits out of consumers while keeping headline prices low.

Airline surcharges on test

Airlines alone charge customers £300m a year in card surcharges, according to the Office of Fair Trading. This is far too high.

Processing a debit card payment costs around 8p-20p, while credit card payments typically cost around 1.5% to 2% of the transaction value. But a family of four taking a return flight with Aer Lingus or Ryanair, for example, could pay £48 in debit card surcharges – that’s at least 240 times the typical processing cost of a debit card transaction.

The same family spending £2,000 on flights with Jet2 would pay a hefty £147 in surcharges if they paid by credit card.

The surcharge problem has grown worse over the years. Between 2004 and now, Flybe has increased its surcharges by 1,025%, while Ryanair has increased its surcharges by 1,400%. And while British Airways previously didn’t charge for credit card payments, it now charges £4.50 per passenger.

Some companies have even put up their charges since we submitted our super complaint in March 2011. BMIbaby, Flybe, Jet2 and Ryanair have all increased their surcharges, while Swiss and Lufthansa have introduced credit card surcharges of £4.50 per passenger.

No escaping surcharges

There is some good news: several companies have either reduced or removed their surcharges. Monarch, for example, has scrapped debit card charges – though they do charge a hefty £10 for credit cards. Easyjet has replaced its debit card fee with a flat fee of £9 per transaction, regardless of payment method. This is included in the total charges shown and is more transparent.

Over 50,000 people backed our campaign to end unfair surcharges, so while we’re pleased the government is taking acion, we will continue to work on this issue to ensure that the Consumer Rights Directive tackles ‘rip-off’ fees. Nonetheless, we want all companies to reduce or scrap their unfair surcharges now, rather than wait until the new rules come in at the end of 2012.

Which companies have you spotted that still charge excessive card surcharges? Name and shame them below.


This issue goes back to one which was discussed ad-nauseam on the boards about the abolition of the cheque guarantee card and the anticipated demise of the cheque: BAnk Charges.

Banks CHARGE all retailers to process cards (they charge different fees depending on the card type too).

Banks CHARGE (huge) fees to all retailers to let them use card terminals (old manual ‘zip-zap’ card machines were FREE to the retailer, but banks have made it all but impossible to use these now so retailers have little choice).

EVERY TIME a card is inserted into a card terminal, whether the transaction is successful or not or even if it is cancelled by the retailer or customer, the terminal dials the authorisation centre thus incurring a minimum telephone call charge (probably about 5p).
To operate a card terminal the retailer must have at least one extra telephone line – line rental fees apply just as they do in your home. Busy retailers will have to have many lines so that terminals do not all grind to a halt fighting with each other for a telephone line connection.

Card terminals have to be plugged in to the electricity supply 24 hours a day. They don’t use a lot of power but it does add up, especially if you are a large retailer with tens or hundreds of terminals.
These costs should NOT be the retailers’ responsibility: it is the BANKS who are forcing us all to use cards to the exclusion of all else, and the BANKS should be paying the ‘phone line rentals, the electricity costs for running the terminals and the ‘phone call charges. Additionally the banks should be prohibited, by law, from charging for processing card transactions, because this is just another aspect of the banks profiteering.

Finally, banks charge a penalty fee to any retailer who does not generate sufficient handling fees in a given period (usually monthly). This penalty fee is applied ON TOP of the handling fees which are paid and is usually a flat rate. Thus if, for example, the bank requires the retailer to handle a minimum of 500 transactions per month, at let’s say 1% of the transaction value, but the retailer handles only 499 transactions, each generating lets say £1, the retailer will be charged £499 (transaction handling fees) PLUS the penalty (which I understand is often hundreds of pounds). This makes it difficult for many retailers to accurately forecast what the bank will charge them at the end of the month.

Of course it IS absolutely WRONG that retailers should charge more than the real processing cost and it is abhorrent and unforgivable that retailers should introduce new fees as they have in many cases since this ruling was announced. It’s also unacceptable and inexcusable that the ruling did not come into force at once.

BUT … the REAL COST of the transactions is way above the simple handling fees that keep getting quoted on Which? convo’s and it can also be hard to calculate in advance – factors which retailers WILL use to justify higher fees, even if they are wrong to do so.

The ONLY way to stop this situation is for LAWS to be introduced which PROHIBIT Banks from charging ANY fees for card transactions, including the penalty fees, AND which PROHIBIT the retailer from charging any more than the telephone line, call and Electricity costs for running the card apparatus. Alternatively the law could force the bank to pay all the running costs, AND prohibit the banks form making and charges, at which point a law prohibiting ALL card fees applied by the retailers could also be reasonably enforced.

BOTTOM LINE: It’s the BANKS who are behind all of this and until Cameron, Osborne et-al really do what all politicians have promised and REIGN IN the banks, this issue will never be resolved.

Which? should really be campaigning long and hard for the changes I have described – without them any other campaign can never hope to be more than partially successful.

Elaine says:
24 February 2012

Multiple passengers are processed in a single card transaction, incurring no additional running costs over a single passenger (except for the overall percentage total).

Harry says:
17 March 2012

Why are the banks still allowed to force companies to use antiquated dial up?

Most businesses that accept cards will have a broadband internet connection, which could authorise transactions without the cost of an extra landline — and would almost certainly do it faster too.

I can’t believe Tesco does individual dial-up authorisation for each transaction, so the technology must exist and there’s no reason why making a bit of hardware that plugs into a router (or uses wifi) should need to cost anymore than one that plugs into a phone line.


I’m strongly behind the comments above.

The majority of complaints below are against known offenders such as RyanAir who are just using credit card charges as an excuse to blag extra revenue while their business process is made far chaper and simpler by the use of credit cards, especially in online bookings.

Their infrastructure overheads per transaction are so small that their costs per transaction will be barely more than the transaction fee levied by the banks,

This is recognised by high street stores, who no longer have to process large amounts of cash, and especially by online retailers who couldn’t operate without card transactions.

I think the situation with taxi drivers is much more complex.
A taxi which will accept credit cards is providing an enhanced service – I think most people these days carry very little cash and pay for most things by card and in an emergency (need a taxi, not enough cash) the ability to pay by card may be a life saver.
However the transaction rates may be quite low, especially until it is generally established that you can pay by card, so the overheads are likely to be high per transaction especially when the equipment is first installed.
[I am ignoring here any financial advantage which may be accrued by dealing mainly or solely in cash 😉 ]
So it seems reasonable to pay a premium for such a service because of the value added.

Very small retailers with low volume low value transactions are still priced out of the card payment system because of the infrastructure costs.
Their margins will not cover the charges, and the percentage of the individual sale price they would have to charge would drive customers away.

If the banks want to do away with cheques then they will have to subsidise the small businesses, charities, local societies etc. who don’t want to deal solely in cash and so rely on cheques for payments.

keith bradshaw says:
16 February 2012

Another rip-off is having to pay for your flight in full even when your holiday is almost a year away. I used to book in May for a November flight and pay a deposit. Now it’s the whole fare upfront. Money in their bank not mine and although banks pay very little interest these days it still annoys.

Fliss says:
17 February 2012

Slightly separate issue………booking flights means we pay a tax. When we cancel or no show the company keeps this. How much does Ryanair and easy jet make by cancels or no shows by levying a tax which is then not paid to the govenment??
Money for nothing….genius

Elaine says:
24 February 2012

I have seen that taxes are refundable from airlines. Check the airline websites for exact terms and conditions.


I have just paid for a holiday in South America with a company recommended to me by a friend, and which i have no reason to doubt is a reputable and fair operator. The charge for paying by credit card was 2% of the total – consequently I paid for most of it by debit acrd (no charge) and some by credit card. 2% seems to me excessive

Michael Vizard says:
17 February 2012

I agree. I have just booked a holiday with Low Cost Travel. If I paid with a credit card, they would surcharge me 2.5%; if a debit card I woulkd still be surcharged 1.5%. They were not keen to have a cheque! This is simply a rip-off. However, my fear is that the industry will just pass the cost on to customers when these charges are prohibited, adding a couple of percent to each bill to compensate. It is not often that the customer wins!


I think the key to your angst is in the “Low Cost Travel” as they will not be able to hide the fee as most retailers do now anyway. It is part of the overhead in our business and yes, it costs us around 2.5% when a customer uses his credit card. We have to smile (more grimace) when they use a debit card to buy a £5 item .. costs to us is then 4 or 5%

Ian Savell says:
17 February 2012

My trip to Rome with Jet2, booked through Ebookers, came with a stonking booking fee which applied to any card – in fact I don’t think it was avoidable at all. This fee wasn’t shown till late in the booking process when Ebookers pass over to Jet2 for the flight booking, though Ebookers did warn a fee might be charged. The fee isn’t broken down on any of the documentation but from memory it might have been as high as 10%

This makes it very hard to judge value for money. Alternative carriers who looked more expensive might have charged lower fees (and might have included free baggage which Jet2 charged £80 for) but I wouldn’t have found out without a lot of abandoning of bookings and might have resulted in losing the hotel room. All in all the package cost £120 more than the headline price.

Phil Smith says:
18 February 2012

I was surprised and disappointed when I recently discovered that British Airways had increased its credit card surcharge from £4.50 per booking, which is bad enough, to £4.50 per person. This is blatant profiteering, with no justification. The cost of processing the credit card charge has not increased and it is in any case a small fraction of the previous £4.50 charge.

mssupertech says:
18 February 2012

There can be absolutely no justification for any company to make a charge per booking/ticket.
The new legislation should be uncompromising about this – and prevent companies placing unreasonable restrictions on the number of bookings on a single transaction.

Hilary says:
19 February 2012

Booked with Thomson in January 2012 for a holiday in April 2012 for family 5 of us; it was low deposit £100, but then 2 weeks later in February we had to pay for whole of holiday, which made it 8 wks before we went. As we had not got paid end of Feb, we put it on my credit card and paid £23.97 on balance of £937.00. They already had our money 2 months before holiday and then to charge cr card fee. thats why they make massive profits!!

Barry says:
20 February 2012

I recently bought two £14 theatre tickets. Face value of tickets £28, fee for paying by credit OR DEBIT card £2. This is a theatre owned and run by the local authority. I understand that private companies are in business to make profits, but it seems that our elected representatives on the local council are not averse to ripping off their customers too.


I recently bought a ticket on line and paying by debit card to visit the Who do you think you are? Exhibition at Olympia, the face price of the ticket is £15.00 but an additional £2.00 was added to process same. Good luck to Which? with your campaign to scrap surcharges.


I just found a transaction charge of £ 2.00 on my online booking for a premier inn. I am a regular guest so know this is a new charge. anyone else noticed this

dane-girl says:
21 February 2012

The NEC exhibition centre has always ripped off it’s customers buying tickets online,charging
a fee for every ticket bought.

Geoff Parkinson says:
22 February 2012

Nottingham city council via the theatre royal,concert concert hall and Ice Stadium rip off their customers.
they charge a high fee to use a debit card. I attend in person and pay cash sometimes hundreds of pounds when buying tickets for friends. this means that NCC has to pay about 1.5% to the cash in transit company to take the money to the bank.
Why do they not have the commercial sence to waive charges for debit cards?


Beware! Thomas Cook charge £12 to use a Debit Card when booking a flight on their airline.

a m thomson says:
25 February 2012

I recently booked flights for my wife and myself from Edinburgh to and from La Rochelle with Jet2. This outfit had the gall to charge 3.6% to the total cost for payment by debit card and ,if I recall correctly, double that for payment by credit card. Rip off par excellence!

Graham Woosey says:
28 February 2012

Another two to beware of – Center Parcs (already one of the biggest rip off merchants for increasing prices during school holidays) add 2% as a credit charge surcharge. Also P & O also charge for using a credit charge – as cruise bills can be high this is a heafty charge. P & O have also announced that they will automatically add a voluntary tip to the on board bill – not mine; I shall take advantage of the facility to opt out of this arrangement when on board and the underpaid staff will get nowt!. Why do companies go to such lenghts to protect their “headline” price and try to add things that they think we won’t see. We’re not daft and they’re dishonest.


Offer to pay direct to their bank account
via Faster Payment and see if this will
circumvent matters.

J Collins says:
1 March 2012

It is rather hypocritical of the Government to state they wish to curb excessive surcharge fees when it imposes a £2.50 fee for taxing your car over the telephone.

patricia.morrell says:
4 March 2012

Thomas Cook wanted to charge £50 to pay my bill of £2000 for 2 people by credit card.


I find Which coverage on this very misleading.” A family of four would be charged £48 by Ryanair” etc. This family of four pays £0. How? Easy, we have the Ryanair prepay card. Nowhere does your article mention this.
“Banning these charges would save you and me £265,000 a day” Don’t be daft, the companies will just push the price up somewhere else

Phil Smith says:
7 March 2012

It’s not daft to want the price paid to be reflected in the headline price. I note that Richard doesn’t mention the conditions in the small print of a Ryanair card. After six months, anyone who does not use the card will be charged £2.50 a month for inactivity, and if that charge puts the card into a negative balance a £10 charge will be made.


And it’s not daft to think that a Which article should tell you the whole story!

Phil Smith says:
7 March 2012

But it’s OK for you not to?

The point, as I am sure you know, is that these charges cannot be avoided, and the Which coverage says just that. The Ryanair card simply goes about it a different way. Unavoidable charges should be included in the headline price. I find it hard to understand how any ordinary customer could believe otherwise.


Steady on. Are you suggesting I am related to Michael O’Leary?! I am not, but I am a Ryanair fan. They have never bumped me off a flight like BA and BMI have done.
The point is the £48 is avoidable. Yes there are potentially CC charges but they are avoidable too.

Phil Smith says:
8 March 2012

Again you omit to mention that the only way of avoiding those charges is by using the card and as far as I know the only way to do that is to purchase more Ryanair products. Do you believe that unavoidable charges should be omitted from the headline price? By coincidence I have just been asked how you can avoid the charge for checking in online. The Ryanair website says:
“An online check-in fee applies to all reservations except in respect of certain promotional fares. This fee is charged on a per person/per one-way flight basis and amounts to €6/£6 for bookings made via http://www.ryanair.com/ and €12/£12 for bookings made via a call centre or at the airport.”
“From 1st October 2009 airport check-in desks will no longer be available at any Ryanair airport. All passengers will be required to web check-in and those who have checked in bags will use the airport “bag drop” desks, if required. ”
More unavoidable charges omitted from the headline price.

Carmel says:
15 March 2012

I tried to book through e dreams and they were going to charge me £17.50 for using my credit card. I went direct to the air line (air lingus) and they’ve charged me £12. Will anything happen about these surcharge payments when surcharging is finally outlawed?

Stuart Ainsworth says:
23 March 2012

Last week I was working in Coventry and wanted to arrange taxis for 9 colleagues to get us to and from a local restaurant. With 9 people we needed two taxis, I called the company to ask if I could pay in advance with a card for simplicity. Response: unless the fare is over £20 they would not accept a card and even then (wait for it) there was a 40% surcharge – I quesried to make sure I had heard correctly and yes its a 40% surcharge! I asked the manager to call me to discuss but unsurprisingly he didnt bother, 4 journeys we actually £28 total for cash – and both drivers asked for a tip!! Its outrageous really.

Robert Jones says:
26 March 2012

I feel that, as indicated by the first comment, small businesses such as small taxi firms and individual taxi owners and some small retailers could be hard hit by bank charges and penalties for these services, but that in other cases, such as airlines with large turnovers in excess of millions, their surcharges are wholly inappropriate.


Beware of both TalkTalk & AOL – they both charge for using cards (same fee for credit or debit) to settle their accounts even if it is a recurring charge ! Of course TalkTalk own AOL and AOL introduced the fee … just after they were taken over. Clearly no connection there then.

TalkTalk charge £4.50

AOL charge £1.99

Keith says:
30 March 2012

I recently booked a ferry crossing from Dunkirk to Dover with Norfolk Lines. Every time I completed the booking form, it gave the charges in Euros, even though I was using the English website, in English. When it came to payment, the site listed the surcharges applied depending upon the method of payment – debit, credit etc. There were different surcharges for different credit cards – Visa, Mastercard, American Express, etc. including European cards. Interestingly, payment with any of the European cards was totally free of surcharges, which were only applied to UK cards. I have a Euro credit card, so I could have used that, but when I checked the price quoted in Euros and converted it to Pounds, I found that I was being charged about £4 more for the priveledge. I contacted the company to ask how I could pay in sterling, to be told that all single trip journeys starting on the Continent were charged in Euros. I solved the problem by making the booking with a UK company dealing with all the ferry operators, who accepted payment in sterling and did not add a surcharge to the bill. So, add Norfolk Lines to the list of rip-off merchants.

smuggley says:
9 April 2012

I recently had a new kitchen installed and when i queried the 2 1/2 % charge for paying by credit card the reply I got was ‘we make no money out of this and indeed with the banks being what they are charges continue to increase so the cost to us exceeds the 2 1/2% levy so we do in fact lose money on this particular transaction’. I’m not convinced. No one seems willing to provide actual figures of costs.


This seems a fair charge … when we signed a 5 year merchant account contract (note that … 5 years !!!) to get the best rates we contracted for variable fees of 1.15-2.00 % depending on the credit card type. Other merchant accounts offered 2.5-3.0% so we thought we did well. There is an additional fee of up to 0.5% to cater for non-UK cards and 50p is charged when a credit is issued if a client brings back an item. All that ignores the other account settlement fees, minimum monthly fee charge, card machine rental (usually around £25 pm), PCI compliance etc etc. If a card isn’t settled then we get a chargeback of at least £25 and we risk huge fines (unlimited) if we side-step any of the authorisation or data protection rules. Oh and although we are locked into a contract that doesn’t stop the bankers from increasing the fees … the ones I quote above are those ruling when we signed. They are higher now !

Chris says:
10 April 2012

Want to topup your mobile by card? Most use Mi-Pay.

Make sure you have selected your bank account and not your credit card, 40% credit card surcharge!!

You are better off buying a Topup voucher, supermarket, petrol station, news agent etc

Ronald Cavaye says:
15 April 2012

It isn’t just the cheap airlines who impose extortionate credit card charges. I have just booked a £2000 flight to Japan on Virgin Atlantic and, as usual, used my Virgin Atlantic Amex ((MBNA) to pay for it. One would think you’d be rewarded for using Virgin’s own financial product to pay for a Virgin flight. But no! That transaction cost a ridiculous £30 surcharge!!! This rip-off must be brought to an end.


Our AMEXCO basic electronic transaction rate originally contracted (so higher today) was 2.9% … Virgin charged you 1.5% which for Amex seems pretty good. All that excludes the account monthly overheads.


Some good news from a regular email received from FlyBE (see below) to whom I have personally complained on many occasions about their pricing policy.

I would say to the many commentators about card fees that yes, online systems do exist (we have one) and they help with overhead costs but only on the 2nd and subsequent machines installed. As a retailer we are expected to absorb the typical 2% credit card costs and 15-20p debit card charges from our gross margin but one can see that resellers of flights etc with low margins cannot absorb all that everytime. Buying a holiday on a credit card with a fee of only 2.5% is hardly a rip-off … why not ask if the agent will also accept a direct bank payment ? A credit card does of course also add a good deal of consumer protection for no extra (sort of free).

I was always given to understand that a retailer could only offer card services provided that they didn’t then offer discounts for cash ! Even American Express insisted that their card must be offered at the same selling price as for other (cheaper) cards … Amexco fees are much much higher that 2% !

On Apr 26, 2012, at 11:21 AM, Flybe wrote:

And starting from today…
– We will no longer charge for the use of debit cards when booking a flight.
– We will only apply credit card fee per booking, not as previously per passenger per sector.


… if I had read further then I would have found :

“There is no fee for debit card transactions. A fee of £9.00 per booking applies if paying by credit card.”

Angry tourist says:
29 April 2012

Having just booked 2 Thomson flight tickets to Orlando in August (already a ‘rip off’ due to school holidays) I was astounded to get charged £32.95 for using a credit card. To say this is an admin fee is a joke !

neil barrow says:
10 May 2012

I have very recently attempted to purchase a holiday from Shearings. The total was just under £700 and when I said I would use my credit card I was informed that there would be a 2.5% charge. This meant a further £16.65. I complained that it was disgusting and cancelled my holiday. They also wanted a further £20 to park at their station.

AM says:
12 May 2012

Please advise your readers that they can avoid credit card surcharges by sending a cheque – even though this is often not advertised. AG TIckets (Ambassador Theatre Group) add a £4 surcharge to EVERY ticket purchased (this was for the New Theatre Oxford),which can be more than 30% on the cheapest tickets. I was so incensed that I wrote a cheque for the face value of the tickets only and posted it to the box office address of the theatre. No problem – I received a call to say that they would hold my tickets for collection. When I complained about the surcharge on the website, the box office manager said that customers have the option of sending a cheque, as I did – but this is not advertised.

Janiegel says:
30 June 2012

I’ve just received confirmation of my holiday booking for a cottage in UK. They have charged me £50 credit card surcharge + a booking fee. In the small print they show a 1.99% charge for credit cards, but what would be much clearer for their customers would be to show what that means in practice. Eg: If you pay by credit card, cost is £1000, if you pay by debit card cost is £950. Then people can make an informed decision, rather than having the shock of seeing this extra cost on their bill.


thomson are charging 2.5% on credit card transactions.

Martin says:
8 November 2012

Travelodge are charging £2 on on credit card bookings on their website. Disgusting! How can we report them to the watchdog in charge of enforcing the fee bans? Who is enforcing this?

Peter says:
2 March 2015

I was told by Justgo Holidays that a 2 per cent charge was made when you use your credit card


Just been charged £2.10 card handling fee – on a 24.75 bill by Empire Cinemas. Nearly 10%