Companies will be banned from charging fees for paying by a credit or debit card.
As of the 13th January 2018, it will be illegal for you to add any surcharges for card payments. Under the current rules and the Consumer Rights Regulations (which came in to force in 2013), you have been allowed to charge an amount that reflects the cost of processing credit or debit card payments and shouldn’t make a profit on these surcharges.
Here at nexpay, we have been advising clients to review their current prices and include the cost of processing payments within retail prices. With debit, credit, commercial and international cards the processing fees can vary dramatically, one way to overcome this would be to review the last 6 months processing data and see which cards make up the majority of your business expenditure.
For example, if your business is weighted 70% towards visa debit users you could incorporate your visa debit cost in to your sales prices. Another option would be to to average out the overall percentage of transaction fees to determine your sales price. Also, some retailers may choose to select the highest price card processing fee and use this percentage to incorporate in sales prices.
Additionally, there have been questions as to why the rules are changing. The change follows a directive from the EU, which is seen to ban surcharges on Visa and Mastercard, however, the UK government has taken this further by also banning charges on Paypal and American Express transactions.
Do you have more questions about the ban? Check out our Credit and Debit Card Surcharge Ban Q&A!