So, just wondering if there are some clever people here who can help me clear something up:
I recently made an online transaction by credit card. After the payment was processed, in my confirmation email, it was pointed out that there was a £5.95 credit card surcharge fee applied. I am really sure that this was never advertised before as I always look out for this, but obviously that’s difficult to prove, as I didn’t screenshot every step.
Anyway leaving aside the question of proof for a second, on a more principled level I have the following two questions:
Can a merchant actually charge a surcharge, if I wasn’t advised of this in advance? What would be the relevant legislation?
I found a fairly interesting bit in mastercard’s rules. These are available at https://www.mastercard.com/uk/merchant/en/how_works/merchant_rules.htm and under the heading “5.11 Prohibited Practices” it says:
5.11.2 Charges to Cardholders
A Merchant must not directly or indirectly require any Cardholder to pay a surcharge […] in connection with a Transaction. […] A Merchant is permitted to charge a fee […] if the fee is imposed on all like transactions regardless of the form of payment used […].
For purposes of this Rule:
- A surcharge is any fee charged in connection with a Transaction that is not charged if another payment method is used.
(The omitted parts deal mostly with allowing discounts for cash payments, defining “fees”, and exceptions if “the Corporations” permits these in writing. But please feel free to read the whole paragraph if you feel I left out something material.)
A naive reading of these rules would indicate that mastercard’s rules don’t allow the practice of surcharges at all. However, given how prevalent these charges are, I find it hard to imagine that mastercard would let merchants away with these if that was the case. Any thoughts?