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Government bans ‘rip off’ credit and debit card surcharges

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19/09/2017 - New rules set to come to force

The government will ban companies from adding extra ‘surcharges’ to all card payments from January next year.

The charges that are added when customers pay for goods or services, which have resulted in extra charges of up to 20 per cent on flights, will be ‘consigned to history’ when the new rules take effect.

Some of the worst offenders are takeaway food apps and global airlines the Treasury said.

Hungry House and Just eat charge between 50p and 75p when customers pay by card, while airlines Ryanair and EasyJet charge a credit card fee of 2 per cent and 1 per cent respectively.

Local authorities and government agencies also impose ‘handling fees’, some councils charge up to 2.5 per cent and the Driver and Vehicle Licensing Agency (DVLA) have a £2.50 credit card fee on all transactions.

In 2010 the Treasury estimated that the total cost of surcharges for using a card, cost consumers £473m. 

Stephen Barclay, economic secretary to the Treasury, 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.”

“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,” he added.

The changes come as a result of an EU directive which banned charges being levied by Visa and Mastercard, but the government has taken it further by extending the ban to cover all cards and payment providers such as PayPal, American Express and Apple Pay.

While most consumers will welcome the news there is concern that businesses will increase their prices to compensate for the missing surcharges.

Guy Anker, managing editor of MoneySavingExpert.com, said: “Scrapping card surcharges is good news, especially for the millions of consumers who would otherwise have been milked by companies who whack on unexpected charges at the end of the process.” 

“We expect some companies will raise prices for all to compensate for the loss, which could hit those who currently pay in cash or debit card,” he added.

By LLB Reporter

Fonte:http://www.londonlovesbusiness.com/business-news/business/government-bans-rip-off-credit-and-debit-card-surcharges/16714.article

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