OFT to ban debit card surcharges

Handing over card

Travel companies will no longer be able to use hidden surcharges for passengers paying by debit card, says The Office of Fair Trading (OFT).

Companies have been ordered to stop charging extra fees when customers pay with a debit card and to change the way they advertise these extra costs with credit cards.

This comes after consumer group Which? launched a super complaint earlier in the year, which led to a 90-day investigation by the OFT into the issue. It found consumers spent £300 million on payment surcharges during 2009.

Surcharges are added on when consumers make a payment, depending on what kind of card they use, by most travel providers.

But the OFT says these are misleading especially when free payment options are only available to a small proportion of consumers (those with specific cards) making the surcharge compulsory for most.

If firms do not comply, the OFT says it will take action against them using consumer protection laws.

Companies need to be upfront

Which? says the charges customers pay are much higher than the actual cost to the retailer.

It says companies need to be more transparent and tell consumers upfront if surcharges are added – "in plain language in their advertising and promotions".

The process of adding on extra charges for customers paying by card is common and the OFT says this is especially prevalent with the airline sector.

Peter Vicary-Smith, chief executive of Which?, says thousands of people contacted Which? in support of the super complaint.

"We want to see the measures recommended by the OFT put in place as quickly as possible and finally put an end to the practice of card surcharging.

"While we understand that some of the regulatory changes will take some time, we urge the OFT to take steps immediately to ensure that consumers know the true cost of their purchases up-front," he adds.

Commitment to change

Cavendish Elithorn, senior director of the OFT's goods and consumer group, says consumers find it harder to shop around and find the best deal if they have to invest time and effort to avoid surcharges.

"We recognise that most traders want to treat their customers fairly. Many already meet the minimum standards we expect under the law and we have secured a clear commitment to change from others.

"However, we will take enforcement action against any businesses that do not respond to today's announcement and instead continue to use misleading surcharging practices," she adds.


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can wait for ryanair's respomce

Last night I booked Paris Hoilidays through Last Minute.com and only way I could pay was either Credit or Debit card. I ended up paying extra even I paid through Bank Debit Card. So well done for taking this action as I was very annoyed.

Now when are you going to stop extra arbitrary charges to telephone 0845, 0870, 0871? It is getting ridiculous because you can not ring anywhere these days without paying extra charges as most customer services have these numbers?

YTOurs sincerely,

Bibek Pradhan

Don,'t the OFT realise that travel companies and airlines will just put up their prices accordingly to cover their loss. So the consumer still won't win?

Well done Which?, thank you. It is about time the consumer struck back.

Well done. It is time these companies were stopped. When booking a flight over the internet there is no other way to pay except by card. I strongly object to being charged to pay by debit card. When I go into a shop I can pay by cheque or debit card and don't get charged.

To Bibek Pradhan

have you not tried www.saynoto0870.com I use it all the time to look for 0870, 0845 numbers etc

Regards M

Bibek Pradhan - try the website " say no to 0870". You get 2 choices to find alternative numbers (Land line no's) by either inputting the company name or the particular number. Not fail safe, because some companies just don't have land line numbers, but in my experience, I'm successful 80-90% of the time.

I have written to my MP, OFT and others - but they all say ' this is 'within the law'.
Not one has said, 'The law needs changing'.

However - if I book 2 tickets from Ryannair, I expect a credit card charge for a (ONE) transaction.No problem.
How can a charge of per passenger per leg of journey be 'within the law'? It is ONE transaction but they (and others) charge per passenger/per leg - that equals 4 times the transaction charge.

IF Ryannair want to charge me 4 times SURELY they should prooess 4 debits to my card?????

It is within the law - so, proof again - the law ( and my MP and OFT) is an ass!

Wow! Lovely content I've come to know your thought about the OFT to ban debit card surcharges. It is really a vital issue to know and you've helped me as well. Thanks and keep it up!!

Many already meet the minimum standards we expect under the law and we have secured a clear commitment to change from others. Proposition du consommateur