In January 2018, you’ll no longer have to pay any extra charges added for paying with your debit or credit card, because the government is stopping businesses from adding surcharges.
A surcharge is an additional fee or payment.
The change is taking place subsequent to a directive from the European Union, which prohibits extra charges on Visa and Mastercard payments.
The government are also banning surcharges on American Express, Paypal and Apple Pay.
What Industries use Surcharges?
Airlines, Food delivery apps and cinema tickets are some of the most common businesses known to add surcharges for paying with plastic.
Food delivery website Hungryhouse have stated that most restaurants force a surcharge costing an average of 50p-75p per transaction. On a £10 bill, 50p would be 5%.
Airlines are charging up to 3% with some charging a £5 minimum payment.
Are There Any Negative Impacts on Banning Them?
Some people have expressed concern that these companies might increase their prices to replace for the loss of the money usually gained from the surcharges, or that they may alter the name of the payment.
Others have welcomed the change, and believe it’s an advantage for consumers.
Managing editor at MoneySavingExpert.com, Guy Anker, believes that the new law brings advantages to consumers but cautioned “We expect some companies will raise prices for all to compensate for the loss, which could hit those who currently pay in cash or by debit card.”.
No recent figures have been released of the total these surcharges are costing UK consumers, however in 2010 it’s estimated that the total for that year was roughly £473 million.
Sources used: http://www.bbc.co.uk/news/business-40648641
https://www.theguardian.com/money/2017/jul/19/charges-paying-card-banned-flights-tax-bills