Convenience may come at a cost when making payments by credit card. Indeed, although card surcharges were banned in January 2018 by the EU, the BBC reports that UK retailers, letting agents and even a university were found guilty of breaking the rules.
A surcharge is an additional fee businesses impose on customers who pay with a credit or a debit card both in shops or online. The EU legislation requires that companies cease to charge customers paying by card – a regulation that could result in saving to EU consumers of up to €550M per year. The BBC investigation has unveiled that retailers are far from applying this rule – quite the opposite – and are instead, illegally charging for card payments.
Students at the University of Hull paying this year’s annual tuition using credit cards were charged over £170 more than everyone else. This comes with the school’s 2% discount offered to students paying their fees by means other than a credit, indirectly placing a surcharge on credit card payers. The university immediately refunded the affected students, stating it was a “genuine mistake”.
A similar case happened in Birmingham, when an Inside Out reporter posed as a customer planning to buy a car priced at £4,795. The car dealer, according to the BBC investigation, insisted on a 3% card surcharge that meant an extra cost of £143.85. When asked about the incident during secret filming, the second hand trader at Rose Motors said the charge was due to “the machine we use” and that anyone who had incurred a card surcharge was entitled to get their From the Latin word moneta, nickname that was given by Romans to the goddess Juno because there was a minting workshop next to her temple. Money is any item that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular region, country or socio-economic context. Its onset dates back to the origins of humanity and its physical representation has taken on very varied forms until the appearance of metal coins. The banknote, a typical representati... More back.
In 2017, UK retailers were charged £1 billion a year for card payments – a loss that the EU regulation was meant to avoid. Yet, as the investigation shows, not all retailers have proceeded to adopt the new rules- intentionally or not – calling for consumers to be more vigilant and to report cases of abuse.
As the saying goes, convenience can indeed come with an (illegal) cost. Perhaps another reason why cash remains to be the safest payment method.