Call to end excessive credit and debit charges - Credit cards - News - Moneyfacts


Call to end excessive credit and debit charges

Call to end excessive credit and debit charges

Category: Credit cards

Updated: 30/03/2011
First Published: 30/03/2011

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Companies charging big fees on credit and debit card transactions have come under fire.

The Office of Fair Trading (OFT) has been asked to investigate excessive credit and debit surcharges after a super-complaint was submitted by Which?.

The consumer watchdog said the charges are 'unjustifiable and becoming increasingly widespread'.

While the cost to companies taking payment by card is around 20p to process a debit card and no more than 2% of a transaction value for a credit card, research found dozens of examples of companies charging far higher fees.
Some of the worst offenders included:

  • A £25 debit card charge to pay a £5,000 deposit to rent a flat through Foxtons, one of London's biggest letting agents.
  • Train booking site The Trainline adds a £3.50 charge for paying by credit card, while Eurostar charges £4.
  • London cab firms Dial-a-Cab and Radio Taxis add 12.5% to the cost of their fares for paying with a debit or credit card, and Addison Lee charges £4.40.
  • Bath and North East Somerset council charges a 3% credit card charge, while the DVLA adds £2.50 for paying by credit card.
  • A family of four booking a return flight with Ryanair would be charged £40 to pay by debit or credit card.

"Consumers are really fed up with paying excessive card charges. So far, over 40,000 people have pledged their support for our campaign to bring these to an end," said Which? chief executive, Peter Vicary-Smith.

"Low-cost airlines are some of the worst offenders, but excessive card surcharges are becoming ever more widespread, with everyone from cinemas and cabs to hotels and even some local authorities getting in on the act."

Which? wants companies to tell consumers upfront if they have surcharges and how much they are, make charges fair so that it costs consumers the same as it does the companies, and for small debit charges not to be passed on to customers.

Once the super-complaint has been made, the OFT has 90 days to respond.

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