Debit and Credit Card Surcharges to Be Banned from January

July 19, 2017

Businesses will soon be banned from levying extra charges to customers who opt to pay for goods and services via either their debit or credit cards.

The new rules are to be introduced by the British government from January 2018 and will prevent a wide range of companies from adding surcharges to card users as many currently do.

Airlines and providers of food ordering services such as Just Eat and Hungry House are cited as being among the biggest culprits when it comes to adding surcharges to online card payments.

However, many local authorities and HMRC have also been in the habit of adding surcharges when users of their websites opt to pay by card.

The government has described the charges as amounting to a “rip off” for consumers, who in some scenarios can find themselves paying an extra 20 per cent for certain purchases.

“Rip-off charges have no place in a modern Britain and that’s why card charging in Britain is about to come to an end,” said economic secretary to the Treasury Stephen Barclay in a statement.

“This is about fairness and transparency, and so from next year there will be no more nasty surprises for people at the check-out just for using a card.

“These small charges can really add up and this change will mean shoppers across the country have that bit of extra cash to spend on the things that matter to them.”

Upon announcing its plans to scrap card payment surcharges, the government noted that the overall amounts of money paid out by consumers under these circumstances totalled an estimated £473 million in 2010.

It also suggested that the decision to bring an end to the practice of charging extra for paying by card is part a broader plan to help families across Britain keep more of whatever money they earn.

The ban on surcharging will also relate to payments being made via PayPal, the global online payments service.

The European Union recently issued a directive designed to ban businesses from charging customers for making payments via either Visa or Mastercard.

If you are struggling to retain control over your personal finances or your debt management problems then Scotland Debt Solutions can help. Contact us directly to arrange a free and confidential consultation.

John Baird

Insolvency Adviser

Tel: 0800 063 9250

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