Government to go ahead with clampdown on card surcharges

Government plans set to be announced could see the end of excessive debit or credit card surcharges by requiring companies to detail their charges up-front. 

The plan was published last year in December, following recommendations from the Office of Fair Trading, although these specific proposals will go out for consultation on Monday.

Minister for Consumer Affairs, Norman Lamb, explained the reasons for the proposals, saying: “It can often be frustrating…to find out only towards the end of the transaction that the final price is much higher due to things like payment surcharges.”

“These proposals will stop companies from adding on these excessive charges, and allow consumers to see a clearer and more transparent breakdown of what they are paying for.”

As well as increasing transparency, the government will limit the charges that can be placed on transactions in order to ensure that companies are not making a profit – a move which has been widely praised.

The executive director of consumer group Which?, Richard Lloyd, said: “The government must ensure that all businesses only charge the genuine cost they incur for processing the payment and that they are upfront, and make this clear to consumers.”

He went on to warn that the government should act quickly to stop consumers being taken advantage of, although it remains unclear when the proposals would actually be brought in. The end of January is the government’s current aim.

Some industries are already clamping down on charges. The flight industry, where customers in 2010 spent £300 million on card charges alone, has forced airlines such as Easyjet, Ryanair and Thomas Cook to start incorporating their administration charges into the overall cost of the flights.

Abbie Cavendish