Card surcharges banned from January 2018

Currently, when your business accepts a payment by debit or credit card it can apply a surcharge to cover the cost, e.g. the service fee that’s applied by a credit card company. However, this practice will be banned thanks to the EU Revised Payment Services Directive which must be implemented into our domestic law by 13 January 2018 at the latest. From then on businesses won’t be able to apply debit and credit card surcharges but you won’t incur them either.

Brexit effect

The UK is obliged to implement this Directive even though we’re leaving the EU, as we will still be a member state in January 2018. That said, it will be open to the government to alter the legislation once we’ve officially left – and it could reverse this forthcoming change. For this reason, it’s looking at the best way to introduce the Directive and official guidance for business is expected later in 2017.

Many businesses do pass on these charges when accepting VISA payments. If you are one of these businesses you must ensure you cease this practice by 13th January 2018. Likewise, if your suppliers attempt to add this charge when making payments you should challenge this.