No more credit and debit card surcharges
From January next year, businesses will not be allowed to add any surcharges for card payments.
Up until now, businesses that accept card payments, whether it be online or offline (bricks and mortar) have either swallowed up the cost imposed by their card processors or passed on the cost of processing a card payment to the consumer. But many businesses have been abusing this and using this as an opportunity to gain extra revenue. Lets say, a well established holiday tour provider, will most likely be charged no more than 2% on a credit card transaction and no more than 1% on debit card (most likely it could lot less than this, possibly less than 0.5%), they would then charge the consumer 3% and therefore make an extra profit from such transactions. If you take into account a holiday package costing £3000, that could be an extra £60 in their pocket and thousands of these holidays sold then you can see that its a nice little earner for them.
Shop keepers make me laugh, they’ll charge typically 50p for any card sales under £5/£10. I bought something from the shop the other day and wanted to pay £2.50 by debit card and they said “50p charge”. In fact the cost of transaction would not have cost that business any more than 2.5p based on them being charged 1%. I then wanted to be an arse and try and educate the owner but his reply was “I don’t care!”. Which made me giggle in surprise as I don’t know who to better handle his ignorant response. I cannot see the local shop keeper discontinue the adding of surcharges on card payments as they’re typically stuck in their ways.
The new rules also cover charges levied by local councils and Government agencies such as the DVLA.
This may be a great time to shop around for a better deal on your merchant account rates
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