HM Treasury

Newsroom & speeches

148/11

23 December 2011

Government to bring forward legislation to tackle excessive card surcharges

The Government is today announcing that it will take action to tackle excessive card surcharges that are opaque, misleading and prevent consumers getting a good deal. Following the Office of Fair Trading’s recommendations, the Government will:

Businesses will not be able to load on excessive payment surcharges. But they will be able to add a small charge to cover their actual costs for using any particular form of payment

The Financial Secretary to the Treasury, Mark Hoban, said:

"We want consumers to be able to shop around. They have a right to understand the charges they may incur up front and not be hit through a hidden last minute payment surcharge.  We’re leading the way in Europe by stopping this practice. The Government remains committed to helping consumers get a good deal in these difficult times.”
The Consumer Minister, Edward Davey, said:

"We want to make sure that consumers paying by card do not have to pay the excessively high surcharges being imposed on them by some airlines and other businesses. That is why we will consult on early implementation of the Consumer Rights Directive provision to protect consumers from excessively high credit and debit card charges."

To take this forward, the Government will publish a consultation in the New Year setting out next steps.

Notes for Editors 

  1. On 30 March 2011, Which? submitted a super-complaint to the OFT about payment card surcharges in the passenger transport sector.
  2. The OFT published its response to the super-complaint on 28 June 2011.  It found considerable evidence of companies using 'drip pricing' practices for surcharges online - adding payment charges to the total price only after consumers have filled in a number of web pages during their purchase. The practice is spreading.
  3. The OFT concluded that surcharging for using a credit or debit card is potentially misleading to consumers when it comes as a surprise and called for the Government to ban surcharges on debit cards.  The Government is today announcing that it will ban excessive surcharges across all forms of payment methods.
  4. The EU Consumer Rights Directive will ban businesses in many sectors, including the airline sector, from imposing above-cost surcharges on any form of payment from mid-2014 (e.g. surcharges that exceed the costs the business incurs on a card payment).  The Government is today announcing that it intends to consult on implementing this provision of the Directive early with the goal of banning above-cost surcharges by the end of 2012.

Back to top

Share

Facebook LinkedIn Twitter Digg RSS Stumbleupon Delicious Reddit Google Plus Share

Press notices

Subscribe

To receive the latest HM Treasury news find out more about our  

Contact us

Media enquiries should be addressed to the Treasury Press Office on 020 7270 5238.

Non-media enquiries should be made to the Treasury Correspondence Unit on 020 7270 5000 or by email.