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Ban on hidden credit and debit card charges

Companies won't be able to hit customers with 'hidden' charges for using a debit/credit card once new legislation comes into force - something which should happen by the end of next year.

This was announced after the OFT (Office of Fair Trading) called for debit card fees to be banned.

The actual size of the fees (on goods and services such as concert tickets and flights) is just one issue. Something else which annoys a lot people is the way they're often 'tacked on' at the end of a long transaction procedure. Once someone's gone all the way through the process of entering their details, they might feel their time's been wasted if they back out at the end, rather than paying the fee.

Adding a charge at the end also makes it much harder for people to shop around and compare prices, since the price they see at the start of the transaction doesn't really reflect the total price they'll actually pay.

So, earlier this year, Which? went to the OFT with a super-complaint backed by literally thousands. They said that surcharges on debit cards were adding a huge amount to the cost of flights: a combined £265,000 every single day.

When the OFT looked into it, a lot of evidence turned up - not just that a lot of companies used 'drip-pricing' (adding charges after people have already filled in various webpages), but also that this practice was becoming more widespread.

Once the new rulers are in place, companies will still be allowed to add a small charge - but only enough to cover the costs incurred.

A spokesperson for the IVA Advisory Centre commented: "Anything which makes prices more transparent is to be welcomed. These are tough times and many of us are taking more care than ever to make sure we're getting the best possible deal. The easier it is for people to compare deals, the more effectively they're able to do this."