Unscrupulous traders can no longer charge rip-off plastic card fees
There’s good news for a change. New regulations come into force today which should stop retailers from charging customers “fees that exceed the cost borne by the trader for the use of that means”. In other words shops and others must no longer add extra fees if you dare to use a credit or debit card.
The Consumer Rights (Payments Surcharge) Regulations outlaw hidden charges. Under the new rules, traders will be expected to make sure that any payment surcharges are representative of the actual processing cost involved and they do not charge more than this.
It’s hoped this will make the process fairer and more transparent for consumers and no longer result in hidden, expensive charges at the end of the payment process.
The surcharges are often used when booking flight tickets but are also imposed by some retailers in other sectors, including rail, event tickets, cinemas, car dealerships and hotels.
The Office of Fair Trading reckons that consumers spent around £300m on payment surcharges in 2010 in the airline sector alone.
Everyone should welcome this, apart from unscrupulous traders who will lose out on a little of their extra profits!
Andy Millmore, a partner at law firm Harbottle & Lewis said: “A significant hidden extra by which some retailers load a charge beyond the actual cost of processing a credit or debit card transaction should now end. The challenge will be how customers are supposed to know what is and what is not the legitimate processing cost.
“Retailers should not be complacent about these changes. They could face legal action if found to be charging more than they are charged by banks.”
Consumer Minister Jo Swinson said: “The practice of excessive payment surcharges has been ripping off consumers for far too long.”
Citizens Advice Chief Executive Gillian Guy said: “Companies have been ripping people off left, right and centre by adding price hikes to credit and debit card payments for flights, events and hotels.
“It is great news for shoppers that these excessive charges have been banned today and that people will only have to pay what it actually costs to process the payment.”
Let’s hope that proves to be the case.Tagged in: credit card, debit card, hidden charges, plastic, retailers
Recent Posts on The Money Blog
- Barking Blondes: Christmas charity begins with dogs at home
- Current accounts: don't wait for official investigation to sort things out, get yourself a new deal and save money now using this table
- Tory tax 'cuts' may not offer much escape from higher-rate tax demands
- My patience is wearing thin with the rogue lenders who still won’t play fair
- Car insurance will become cheaper, but there are still problems with the cost of cover
Latest from Independent journalists on Twitter