Charging to use credit card

[crazylegs]

I was recently checking out of a small, locally run hotel in the Lakes and enquired if I would be charged extra to make payment by credit card. The guy seemed quite suprised that I asked, and we had a quick chat where he explained that a retailer wasn't allowed to do this and if it ever happens I should contact Visa/Mastercard and the would refund the charge and issue a warning to the retailer with a view to removing their machine.

However, this seems to happen quite a lot - I was just in the queue behind somebody in a well known chain of gift stores, and they were charged 25p for the privilege of paying by credit card because the transaction was under £5.

I can't imagine that large retailers are overlooking such a fundamental rule - was the guy talking cobblers or is there some truth to what he was saying?

[Prof Higgins]

Not talking with any actual knowledge on this but think he must be talking rubbish; Ikea have certainly recently introduced a charge for people paying by credit card and can't imagine they would have taken this step without checking it all out first.

www.ikea.com/ms/en_GB/customer_service/faq/faq.html

[Size Nine Elm]

If you book Easyjet flights you pay a surcharge if you use a credit card - nothing if you pay by Switch.

It's just passing on the charges from the credit companies - in a competitive world, taking a 4% hit from the price can affect your gross margin considerably.

E.g. my CC gives me a 1% payback - which is coming straight from the retailer. Why should he automatically give me a discount for paying with a CC?

[2 Smokin Barrels]

There was a time when you couldn't make an extra charge, but now you can.

(Or is it the other way around? )

[insurance_jon]

You definately can now, and we do!

[Simpo Two]

Some of my suppliers charge for taking a credit card.

I get charged about 3.5% to accept credit card payments (4.5% for corporate cards I think) so you can be sure I'll add it to the bill if I possibly can.

[arcturus]

This is taken from my Barclays Merchant Services User Guide:

Barclays Merchant Services said:

Under the terms of the Credit Cards (Price Discrimination) Order of 1990, you are entitled to add a surcharge to any transaction made by credit card. However, if you decide to do so, you run the risk of being uncompetitive and upsetting your customers who will then be paying higher prices than those who pay with a debit card, or by cheque or cash. Should you impose a surcharge, there are several procedures you must follow and a number of restrictions by which you must abide: 1. Under the terms of the Price Indications (Method of Payment) Regulations 1991, you must display at the entrance of your premises, and at the point of sale, how much extra you charge for payment by credit card. If you sell motor spirit, the regulations are contained in the Price Marking (Petrol) (Ammendment) Order 1991. 2. If you operate a mail, telephone, or internet order service, you must make certain that your customers are told of surcharges before they place the order. You must also ensure that your catalogues, advertisements and the order form itself carry exact details of your intention to surcharge those customers who wish to pay by credit card. Please Remember: Price discrimination or surcharging is limited to credit cards - you may not place a surcharge on the price you charge for payments by any other card, for example, debit cards such as Visa Debit, Visa Electron, Maestro, Switch and Solo. The amount of surcharge, which you may add to your normal cash price, must not exceed the amount of the merchant service charge that you will pay to Bayclaycard and can only be levied on credit cards.

[crazylegs]

Barclays Merchant Services said:

Price discrimination or surcharging is limited to credit cards - you may not place a surcharge on the price you charge for payments by any other card, for example, debit cards such as Visa Debit, Visa Electron, Maestro, Switch and Solo.

Interesting - I was charged 25p for a dental check up by Switch card because the amount was under £20.

Do these rules not also extend to public bodies?

[arcturus]

I'm not aware of a rule change to allow surcharging on debit cards.

And AFAIK, the rules apply to everyone so you should not have been surcharged.

>> Edited by arcturus on Thursday 10th March 10:35