The government is to consult on plans to ban companies levying surcharges on consumers when they use payment cards later this summer, the Consumer Affairs minister has said.
Some companies currently charge consumers a fee for buying goods or services using credit or debit cards or via other payment methods. Under government plans outlined in December last year, businesses will only be permitted to levy "a small charge to cover their actual costs for using any particular form of payment". 'Above-cost' surcharges will be banned.
Norman Lamb told the House of Commons earlier this week that the government would seek views on when the payment surcharge ban should be introduced into law and how such a ban should apply.
The government has until 13 December 2013 to "adopt and publish" new laws, including implementing a payment surcharge ban, in accordance with a raft of new EU consumer rights laws that were introduced last year. The implemented laws would apply from 13 June 2014.
However, in its December announcement the government had said it wanted to "become the first European country" to act on banning "excessive" payment surcharges and that such a ban would be in force "before the end of 2012".
Lamb has now said though that the date that payment surcharges would be banned from would be put up for consultation.
"The EU Consumer Rights Directive will require member states to prohibit traders from charging consumers fees that exceed the costs borne by the trader for the use of a given means of payment," Lamb said. "This will ban excessive payment surcharges in areas within scope of the Directive. The Government supported the inclusion of this provision in the Directive."
"The government shares consumers' concerns about the high level of payment surcharges imposed by some businesses," he added. "We intend to issue a full 12 week consultation in the summer to seek views on the timing of implementation and other details on how the provision should be applied. Responses to the consultation will inform our decision on timing and our guidance to businesses."
Under the terms of the Consumer Rights Directive, if there is any extra payment required for a transaction to be completed traders must "seek the express consent of the consumer" before any sale occurs. Consumers will be entitled to a refund of any extra payment if the trader has not received their "express consent" to the charge.
The government has proposed centralising all existing UK consumer protection laws and regulations under a new Consumer Bill of Rights. It said last year that such a move would "consolidate, clarify and strengthen" consumer protection legislation.
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