Charges for card payments to be banned from next year

Government move on card charges about fairness and transparency
Government move on card charges about fairness and transparency

“Rip-off” surcharges levied by companies on customers who pay with debit or credit cards are to end at the beginning of next year, the Government has announced.

The new rules will ban companies from charging up to 20% more for purchases such as flights just for paying with a credit card.

The surcharges are commonly levied by businesses ranging from takeaway apps to global airlines on customers who pay by card or use other services such as PayPal.

The new rules will also help in tackling surcharging by local councils and government agencies such as the DVLA.

Businesses usually say the surcharge is to cover the cost of processing a card payment.

The total value of surcharges for debit and credit cards was an estimated £473 million, according to Treasury figures.

“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.

“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.”

The Government has previously capped the costs that businesses face for processing card payments and said it will will engage with retailers to assess if there is any more that can be done to help.