Charging for using a debit card

[Piano Cube]

Hi,

not a huge issue here but wanted to know out of interest.

 

 

A local shop has started to charge 30p for paying with a debit card, the amount was about £13 so i refused and he let me off. I was surprised about this and after telling a lot of people apparently it's more wide spread than i thought. Is this legal and if so why isn't everywhere doing this, i am considering a name and shame of local businesses and getting the message to consumers that they do not have to necessarily pay this fee. Any legal advice would be very helpful. Thanks in advance.

[blitz]

Its legal, they can accept any payment method they wish to and if they want to charge you for making a payment again they can as long as they let you know before the payment is taken (I.e they don't add it on without your knowledge).

 

For an FYI most large companies charge you for using a credit/debit card a fee of usually about 2.5% for processing thetransaction, however you get charged the same amount no matter what you pay (Meaning they take the extra 2.5% themselves if you pay by cash)*. A small business adding this cost on as an extra means that most people save money and they can keep there prices down. They could always up there prices by 5% to take into account the cost?

 

*I know Argos do this (There is a sign stickered on every till), I think tesco do it too, look around the tills for a notice etc.

 

Short version: Most places do even large chains, For small businesses them charging you an extra 30p per card transaction keeps there goods prices down.

[Bookworm]

Ikea charges 70p by credit card transactions, and of course, Easyjet and Ryanair are both infamous for loading up the fees on card payment (even though you can't pay by other means ), although I believe that if you pay by electron/visa debit then they don't charge it or charge less. (different policies for both airlines, so not sure which does one anymore)

[raydetinu]

I thought they just applied it credit cards not debit?

[buzby]

Heck, some firms charge you for ANY payment (that isn't by DD). The only free transaction with Ryanair is by using a Visa Electron - other debit cards have a 'modest' charge, credit cards a considerably larger hike.

[Conniff]

There is no fixed fee charged by the banks for debit cards as it comes directly from the account but the retailer can charge if they so wish. The now famous 'admin' charge.

[raydetinu]

Well I suppose so; but they must declare it before you pay, lets hope garages and supermarkets dont follow suite and you always have the option to say well I will go somewhere else that dose not charge and see if they will be prepared to loose the custom in these so called hard times. tTHE CONSUMER IS KING REMEMBER at least on here!

[buzby]

There is no fixed fee charged by the banks for debit cards as it comes directly from the account but the retailer can charge if they so wish. The now famous 'admin' charge.

 

 

There is, and it is fixed by the bank. However it is up to each bank to set the fee based on their customer's business. In my case, these are classed as 'electronic creidts' and I pay a fixed fee of 20p for each. Using one of the PDQ/Streamline services (the machines) the fee is arranged directly between the Merchanr and Card processor depending on the volume of transactions per month. It IS safe to say, however, that debit cards have smaller fees as the commission element is less.

[Conniff]

You're right, I didn't know that. I have never been charge for using my dc.

 

"Fees charged to retailers by banks for processing their debit card payments are to be investigated by the Office of Fair Trading (OFT).

 

They will now be scrutinised as part of the OFT's investigation of the interchange fees charged by the credit card operators Visa and Mastercard.

The OFT has previously called the credit card fees a tax on the consumer.

The widened investigation has been welcomed by the British Retail Consortium (BRC).

BRC Director General Kevin Hawkins said the charges were unjustifiable.

"Retailers have no choice but to accept cards belonging to Mastercard and Visa and to pay their fees for the privilege," he said.

"Mastercard and Visa have been sharply pushing up debit card fees with no convincing justification. "With an ever-increasing proportion of retail sales now made on debit cards, it has to be right to include them," he added."