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News & Views Detail
Jul 2012 - Card surcharge changes
At long last changes are happening to force a little more honesty in the application of payment card surcharges. Airlines, who were probably the worst culprits, are being forced to make debit and credit card charges clearer for customers, following an investigation by the Office of Fair Trading (OFT). The investigation was launched in March following a super complaint from Which? Twelve airlines have agreed to include debit card surcharges in the headline price rather than add them on at the end of the booking process, making it easier for them to calculate and compare prices. Aer Lingus, BMI Baby, Eastern Airways, easyJet, Flybe, German Wings, Jet2, Lufthansa, Ryanair, Thomas Cook, Thomson (TUI) and Wizz Air have all agreed to the change. Unfortunately airlines will continue to impose surcharges for credit cards, but the surcharge will be made clearer for customers when they are booking fights.
According to the OFT, airlines charge customers £300 million a year in debit and credit card surcharges. Although processing card payments is apparently a little pricier for airlines, given that bank charges on debit and credit card payments amount to 9.3p and 33p per transaction respectively this seems rather excessive and it is about time such organisations stopped charging these ridiculous fees and also stopped blaming the charge solely on card processing costs.
By August 1, airlines and other businesses must:
· Include the cost of paying by debit card in their headline prices.
· Make the extra charges for credit card payments more transparent by revealing them early in the booking process.
While the latest announcement undoubtedly represents something of a victory for consumers, there could be more good news in the future. The government has reaffirmed plans to introduce an outright ban on excessive debit and credit card surcharges by the end of the year. Hopefully there will be no u-turn on that policy.
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