END OF THE SCANDALOUS CREDIT CARD SURCHARGES
From today, firms like Ryanair are BANNED from card fees... but will they simply cheat?
AIRLINES, takeaways and event organisers will be banned from charging extra credit card fees from today.
However, businesses have already started to bring in new charges instead. The EU Payment Services Directive means no business will be allowed to seek surcharges for using the cards, which can add 2% to our bills.
But Just Eat Ireland has told the
Irish Daily Mail that it is ‘introducing a 50c service charge on all orders from next week’.
It said: ‘The existing 50c charge for those paying with a card is being eliminated. As every order is a cost to administer, the changes ensure that the cost of the provision of service is applied equally across our customer base.’
The worst offenders with card charges have often been airlines and ticket sellers. Ryanair only stopped charging 2% per booking this week – at the last possible moment. And the airline, run by Michael O’Leary, is expected to put up prices elsewhere.
Alex Paterson, a transport analyst at Investec bank, said: ‘Currently, businesses can only pass on payment charges that genuinely reflect their costs.
‘Many airlines charge in excess of this, with Ryanair charging 2%, and we expect them to increase underlying prices to compensate.’
A Ryanair spokesman said: ‘We don’t comment on analyst speculation.’ Companies have always insisted the charges were only imposed to cover the extra fees they had to pay for the cost of processing credit card payments, but campaigners said they were hugely inflated.
Although the new rules ban discrimination against anyone using a particular form of payment, there are no obstacles to adding an extra fee as long as it applies to everyone equally.
Finance Minister Paschal Donohoe signed the new regulations into law yesterday.
He said: ‘Consumers want to know that their payments are safe when they shop or make a payment, be that in store or online.’ He said the new rules should ‘ensure that consumers have stronger rights and greater choice when using payment services’.
However, many businesses in Britain have already admitted plans to hike prices elsewhere to claw back the cash lost in scrapped credit card fees, and there are fears that more companies here in Ireland could follow suit.
A survey by data company Wex found that 21% of travel agents in the UK are expected to charge customers a ‘booking fee’ to recover their profits. Another 29% said they will put up costs.
As long ago as August, the UK’s Association of Independent Tour Operators told the 122 holiday firms it represents to introduce a flat 0.5% commission on all bookings through travel agents.
Also in the UK, Swansea City soccer club is forcing fans to pay as much as a £2.50 fee a ticket even if they hand over cash at the counter, on top of the advertised price. It triggered a backlash from fans, who branded the club ‘a joke’. Swansea said the changes were ‘largely due to the new government legislation’.
The cost applies to all customers Tour firms told to put up prices