• Ralf Gladis, CEO at Computop


• 19.07.2017 12:00 pm
undisclosed

The surcharges currently being charged by some retailers and merchants on credit and debit card transactions do not reflect the true costs that merchants pay per transaction. A 3% charge on an international flight or holiday far exceeds the actual cost. However, a UK government ban on fees might sound like a win for consumer rights, but is likely to have the exact opposite effect.

Banning merchants from passing on surcharge fees on PayPal, American Express, credit and debit card transactions will push up product and service prices for all which removes any level of transparency and choice from the consumer.

A better alternative would be to allow surcharges per transaction that truly reflect the cost of the transaction.  If merchants are offering their customers transparency in showing which extra costs are related to each payment method, it will give consumers a chance to see and compare charges and also decide on other alternative payments methods, like ‘faster payments’.  In doing this it would also give alternative payment methods which are popular elsewhere in Europe, such as bank transfer or direct debit, a chance to thrive in the UK. 

More choice means more competition and better value for the consumer.