Companies Won't Be Allowed To Charge You Extra For Paying By Card As Of Next Year
Companies will no longer be able to charge customers extra for paying by debit or credit card.
The new rule will come into action in January next year and will mean that businesses cannot add a surcharge on card payments in the UK.
According to the BBC, airlines, food delivery apps - like Just Eat and Hungry House - and small businesses are the most likely companies to slap on a surcharge.
For example, if you wanted to buy a Flybe ticket with your credit card, you would currently be paying an extra three percent.
Government departments and official bodies will also be banned from adding on these charges. As it stands, the DVLA adds £2.50 to tax payments made by credit cards.
Estimates from the UK Treasury suggest that people lost £437 million on charges in 2010 alone.
The ban on additional charges comes from a directive from the EU, which places bans on Visa and Mastercard surcharges. But the UK government has taken it a step further, so the ban also includes PayPal and American Express, too.
However, before we all get too excited, the new ruling means that some companies will be likely to raise prices slightly to help cover the costs they incur from taking card payments.
The BBC reports that banks usually charge big businesses between 10 and 20 pence for debit card transactions and 0.6 percent for credit cards.
Guy Anker, managing editor of MoneySavingExpert.com, told the Guardian: "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."
But James Daley, managing director of Fairer Finance, told the BBC it's much fairer to do it that way around, giving customers the full price straight away, rather than hitting them with a charge later on.
Speaking about companies increasing prices, he said: "That's fair game. You have to take customers' money somehow. And it's not reasonable to add that cost on at the end of the process. Why not put it in the headline price?"
Featured Image Credit: PA