/ Money, Travel & Leisure

One year later: airlines finally scrap surprise surcharges

Today, the Office of Fair Trading announced it has persuaded a number of airlines to include debit card surcharges in headline prices, and to make credit card surcharges clear and upfront.

You may be reading this and thinking, ‘hasn’t Miranda said this before? I thought Which? won this battle last December’. Well, you’d be right! But much like Rome, campaigns aren’t built won in a day.

When it comes to campaigning, you’ll often overcome one hurdle only to find a few more down the track.

We’ve got good news

In December, we celebrated a mighty surcharges victory as the government announced it would ban excessive debit and credit card charges by the end of 2012. They planned to do it quickly by bringing in an Article of the Consumer Rights Directive 18 months before it was officially due.

But when the Office of Fair Trading (OFT) upheld our super complaint on ‘rip-off’ surcharges back in the summer of 2011, it also committed itself to enforcing the OFT’s own rules on transparent pricing by getting strict on airlines’ compliance.

Today’s good news marks the end of the OFT’s year-long negotiations with the airline industry to drop debit card charges and be more upfront about credit card fees.

All of these victories may seem a bit confusing; especially if you’ve noticed you still have to pay surcharges. But the good news is that by the 1 January 2013, wherever you shop, you won’t have to pay any more ‘rip-off’ card surcharges.

Making fares fair

You may still find a surcharge for paying by card, but this will reflect the cost charged to the company for processing your payment instead of an over-inflated figure. For debit cards, this charge should only amount to between 10 and 20p, while for credit cards the cost will equal a small percentage of the purchase price.

As the debit card charges are so small, it’s likely that most businesses will follow the lead of the airlines and include them in their headline prices.

So over the next few months you should see some changes when you book flights, as airlines follow the likes of Flybe and drop debit card charges and make credit card charges clear and upfront. The OFT has published a full rundown of which airlines have agreed to what charges, and when they plan to implement the changes.

The end is in sight…?

‘So the campaign is over?’ you ask. Well, if only things were as easy as that. For the next six months, we’ll be busy making sure the government sticks to its December 2012 deadline and the OFT remains vigilant on whether airlines stick to their agreements.

We also hope that the OFT will use the airlines’ action as a precedent for how all industries should be operating and will clamp down on all ‘rip-off’ surcharges.

Comments
Profile photo of rarrar
Member

Good news – but I fear some airlines will abolish card charges but introduce a booking or admin fee instead !

There is also the issue of non-optional extras e.g. a fee to check-in ,even online , which you cannot escape.

Profile photo of NFH
Member

Ryanair will no doubt find another way to exclude unavoidable charges from the advertised headline price, in order to make its fares look cheaper than they really are. For example, they might well start charging for cabin baggage – unavoidable for most passengers, but Ryanair would claim it’s an avoidable optional extra. One US budget airline, Spirit, already does this; see http://www.spirit.com/OptionalFees.aspx

Profile photo of NFH
Member
Member
Sophie Gilbert says:
7 July 2012

Yes, this is indeed good news, but like rarrar and nfh, I have no doubt airlines will find a way round this. If they start charging for cabin baggage, I can see myself wearing a homemade maxicoat with very many zipped pockets with all my stuff in it every time I fly. But then airlines will start weighing passengers and… Let’s face it, along with all the hurdles Miranda mentions, we’re facing an uphill struggle.

Profile photo of crystal
Member

Good news about the airlines – but there are other ‘bad guys’ out there charging hefty surcharges too. So please don’t ease up on the campaign until all loopholes have been stopped up.

Member
Jaki Whitaker says:
19 July 2012

I am absolutely amazed that the debit card processing fee is only 10p – 20p, especially as Jet2 have just charged me £40 to pay by debit card (the same fee applies to debit & credit cards, with the exception of an Electron card). I feel well and truly rippped off!!

Member
geedee says:
19 July 2012

Simple answer to this outrageous practice – boycott the carriers concerned!

They will soon learn when they have now passengers……………….

Member
Sheila Hamilton says:
19 July 2012

My husband and I have just paid over £50 EACH extra to pay for our holiday with Thomson’s by credit card. Total rip-off and DEFINITELY not good public relations. I have also just renewed my passport and paid by credit card at the Post Office – and what do you know? No extra charge. Shops and restaurants make no extra charge. Are travel agents so desperate?

Member
Anita Heerwagen says:
20 September 2012

I fly with Easyjet to Paris every couple of months. When my husband came with me we could take 32 kilos for two people in one case for £18. Now however it is £20 and we can only take 20 kilos between us. Another rip off – they will do anything to make money out of us. Next thing they will charge for using the loo!

Member
Anita Heerwagen says:
20 September 2012

Easyjet have also begun to add a £9 fee for admin! Whose admin? We do it all ourselves when we book on the internet.

Member
Jonathan Crisp says:
16 November 2012

Just booked a holiday online with Virgin. There was the expected option to pay with either a credit or debit card. The (very) small print suggested there would be a 2.5% surcharge if paid by credit card. Before paying, we tried both options on the site to see if the price changed. The cost shown as ‘Total amount to pay’ did not change (£1775.72 in both cases), so we paid by credit card. Once paid, the ‘Amount paid today’ line was £1775.72 and the ‘Outstanding balance’ showed as zero. We received a confirmation email showing ‘Total for your holiday’ as £1775.72 followed by a reassuring paragraph which said, “The total holiday price shown above includes any applicable taxes, surcharges, promotional offers, discounts and ATOL levies”. This email made no mention whatsoever of a credit card surcharge.
A day later we received an email containing the Booking Confirmation Invoice from Virgin, which showed the ‘Amount paid’ as £1820.11, including a credit card surcharge of £44.39. Our credit card company confirmed this was the amount taken by Virgin.
Not only did Virgin not show the surcharge in the total before we paid it (and still had the option NOT to pay it, i.e. switch to debit card), but they didn’t actually apply the surcharge until AFTER we had paid.
We are still arguing with Virgin.

Member
Anita Heerwagen says:
16 November 2012

So Virgin has also jumped on the bandwagon! Something must and should be done nationally to stop all these ‘extras’. Why can’t they just give a price and stick to it? Easyjet charging £9 admin fee is a disgrace – we do all the admin work online when we book! Flew to Poland last week with Ryanair – some of their staff really do need the big hats that come with ‘Jobsowrth’! Flew to Germany three weeks ago with Lufthansa – spot on – absolutely wonderful. Would definitely use them again instead of ‘cheap’ airlines because it cost just the same in the long run and we had a better baggage allowance.

Profile photo of crystal
Member

It’s not just airlines that make exorbitant charges for credit/debit cards. Please keep up the campaign to ensure that these rip off charges are completely eradicated.