Credit card surcharges to be banned

jonesMUFCforever

creditscoremeansnothing wrote: »

Brilliant plan by the Government which will backfire.

I own a business and to give my customers the best value i have made a surcharge to cover credit card payments (i have only ever passed on the cost which i pay).

Now i can't charge extra and call it a "card charge" so from January i have raised all my prices to cover the cost of this so everyone now pays more and so is penalised.

Great Plan!

Nothing wrong with that at all - did you give a discount to any of your cash customers>? If not why not?

JennyR68

StopIt wrote: »

I'm not entirely sympathetic to the "Think of the small business" stuff.


Small business have to pay for their cash to be processed at a bank, yet I've never heard of being charged a "cash fee". There's costs to any sort of payment method, be it at the time of processing, or later and most business get on just fine averaging them out in the total retail cost of the items being sold.


Of course, business like Ryanair who use the charge to frankly take the proverbial can go take a jump too. I'm not going to mourn these costs being banned at all.

We are one of those small businesses you refer to. We try keep our prices as fair as possible and wouldn't be comfortable hiking our prices to cover and penalising those who don't pay by card. Our much preferred method would be bank transfer or cheque which costs no extra as covered by our monthly bank account charge. Cash as you say does incur a fee which makes it rather ridiculous the amount of customers that try it on and ask for a discount for cash but it is only £5 per £1000 to deposit compared to anything between £17.50 to £35.00 to process a £1000 credit card payment depending on your service. So you cannot possibly compare! We only accept card payment when the customer insists that's how they want to pay so it really pains not to be allowed to pass on the consequences of their money management or lack off back on to them and make it our problem not theirs!

creditscoremeansnothing

jonesMUFCforever wrote: »

Nothing wrong with that at all - did you give a discount to any of your cash customers>? If not why not?

Hey good point and may be a way around the new law. I could increase all prices by the average credit card processing fee, lets say 2%, and then discount the price by 2% for anyone paying cash. Nothing in the new rule stopping me doing this i don't think. Good idea.

[Deleted User]

That won't work. You're still differentiating based on payment type.

System

chattychappy wrote: »

I resent this government/EU interference. I should be free to negotiate with a trader. If they want to offer a discount for cash, take CC for a fee etc etc., then I should be able to make my choice, haggle, go elsewhere etc.

The only issue should be transparency - and I've got no problem with the government enforcing this.

If CCs know that shops can no longer offer cash/debit card deals for less, doesn't that reduce the incentive for CCs to keep their fees low?

If they want to interfere, it would be better to address:
1) DCC
2) The "almost" standard 2.75% charged for foreign transactions.

Numbers 1 and 2 are related to being outwith the Euro Zone.
Single currency = no DCC or loading.

You can negotiating a discount for cash if both parties agree.

With near identical interchange fees between credit and debit, I don't see why many would offer a card type discount going forward though.

chattychappy

Heng_Leng wrote: »

Numbers 1 and 2 are related to being outwith the Euro Zone.
Single currency = no DCC or loading.

You can negotiating a discount for cash if both parties agree.

With near identical interchange fees between credit and debit, I don't see why many would offer a card type discount going forward though.

Well, we haven't joined the Euro, so 1 and 2 do apply. And even if we did use the Euro, it would still apply in the case of many destinations people choose to visit: North America, South America, Asia, Australia plus, of course, Poland, Sweden, Czech Republic, Denmark, Switzerland etc.

Disagree about the interchange fee thing. It is only a component cost of debit/credit card acceptance. The fees charged to merchants can be quite different. In my case my business pays a fixed charge for accepting debit cards but a % for credit cards. As you suggest in the other thread, the charges could converge. But if they converge at a high level than the cost to the merchant of other payment methods, then I feel to stop merchants reflecting that in pricing is uncompetitive.

As you say, though, in many cases parties might well negotiate a discount for "real" cash, bank transfer etc., whether or not the law permits it.

Fingerbobs

Deleted_User wrote: »

That won't work. You're still differentiating based on payment type.

Do the new rules mean that Three (the mobile operator) will no longer be allowed to surcharge customers £5 per month for not paying by Direct Debit?

chanz4

they will just build the charges in end of

jonesMUFCforever

chanz4 wrote: »

they will just build the charges in end of

I agree with you - but I have no problem with that - you can pick the best prices for you with no nasty surcharges at checkout.

robpw2

eDicky wrote: »

In October when I bought a bag of nuts in a Turkish shop in Hackney, the proprietor informed me of a £1 charge if I paid by card. I asked him what he will do in January. "What in January?" I mentioned the impending abolition of charges for card payment. "Oh well, we'll see..."

i paid for a newspaper by contactless and the man behind counter told me they would be charging fees from the end of decemeber as the law was changing ... clearly he didnt understand it - i didnt feel like explaining -i do hope that someone does take the time to inform all these people though