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From 13th January 2018, businesses will no longer be able to add any surcharges for paying by card.
Although certain industries such as airlines and takeaway delivery services have been known to add charges, the government have said that many small businesses have not passed on extra charges for payments of goods and services made by card. The introduction of the new rule next January will bring an overall end to it.
Stephen Barclay, the economic secretary to the Treasury, said: “Rip-off charges have no place in a modern Britain, and that’s why card charging in Britain is about to come to an end. This is about fairness and transparency.”
Councils and government companies have also been known for adding these extra charges, the new law will also apply to them. The Driver Vehicle Licensing Agency currently adds a fee of £2.50 to vehicle tax payments by cards and HM Revenue & Custom charges a fee for paying a tax bill by credit card ranging from 0.37% and 2.406%. From 13th January they will no longer be able to charge this for paying by card.
For many people the new rule is well overdue, but consumers may now be worried that companies may put their prices up as a result. Guy Anker, managing editor of the MoneySavingExpert.com website, said “We expect some companies will raise prices for all to compensate for the loss, which could hit those who currently pay in cash or by debit card.”
Independent business owners must make sure they are fully aware of the date that this new rule will be enforced and that they are compliant. Companies that do not comply will be liable for a fine.
The government claimed it will go further by banning charges for services such as PayPal and American Express. The ban is largely due to the idea of the UK moving to a cashless society. Last week VISA announced that they will soon offer businesses a lump sum and free contactless technology upgrades if they banned their customers paying with cash.
If your business is looking to review the cost of accepting card payments, Handepay are offering a Price Challenge whereby if they can’t save you money you will receive £1000. To find out more about the Handepay Price Challenge, visit their website or call 0800 377 7382.