Rip off card charges to be outlawed

The Treasury has today banned what it has called the “rip-off” charges companies extract from consumers using credit and debit cards to buy goods.

The UK government said today that it is unveiling the new rules that will mean card-charging in Britain – where people can be charged 20 per cent extra for purchases like a flight just for paying with a credit card – will come to an end in January.

‘Surcharging’ has become a common practice across the country – with businesses ranging from takeaway apps to global airlines charging people to make card payments or for other services such as Paypal.

In 2010, the total value of surcharges for debit and credit cards in Britain was an estimated £473 million.

While many industries have acted to absorb the cost and not pass these on to consumers, the Treasury said the new rules will bring an end to the practice entirely.

The rules will also tackle surcharging by local councils and government agencies, such as the DVLA, which charges a flat fee of £2.50 for a card and since 2012 has made £42 million from such levies.

Economic Secretary to the Treasury, Stephen Barclay, said: “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.

“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.”