Credit and Debit Card Fees to Be Banned

Card fee ban

New rules which come into effect on 13 January 2018 will mean it will be illegal for companies to charge customers for paying by card.

The Economic Secretary to the Treasury, Stephen Barclay stated:

“It’s about fairness and transparency”.

“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.”

In 2010, the amount collected by merchants was nearly £500m.

This is good news for customers, who will no longer be penalised for paying by card, but with banks still charging the fees, companies will now be required to absorb the cost or increase their prices to compensate.

Please make sure you are ready for these changes, failure to comply could result in a fine and imprisonment.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

2 thoughts on “Credit and Debit Card Fees to Be Banned

  1. My family has been in business for over 30 years and have been charging customers 25p for card transactions, which is approximately half of the transaction fee charged by our card machine operator. We believe this is a fair amount as we are providing a service. I believe the law has come into place due to large internet organisations such ticket booking lines and travel companies charging extortionate rates to pay by card which doesn’t tally to the actual amount it costs them to process these payments. This is another struggle for small independent businesses.

    1. Hi Saqib, it is definitely unfair on small businesses. Ideally, the fee would be removed completely, but we can’t see this happening. Unfortunately, the companies who charged the extortionate fees will probably just increase their prices, leaving them unaffected. We’re sorry that your business has been affected by this.

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