The UK Government is to outlaw card surchages applied by retailers and e-commerce operators that penalise customers who choose to pay by debit and credit cards.
The Government has unveiled new rules that will mean card-charging in Britain - where people can be charged 20% extra for purchases like a flight just for paying with a credit card - will come to an end in January.
The crackdown comes as a number of industry sectors continue to flout an EU rule change in December 2015 which capped “interchange fees” on credit and debit cards to no more than 0.3pc and 0.2pc receptively.
While many industries have acted to absorb the cost and not pass these on to consumers, others, such as corner shops, insurance companies and airline operators, continue to penalise consumers who choose to flash the plastic.
In 2010, the total value of surcharges for debit and credit cards was an estimated £473 million.
The economic secretary to the Treasury, Stephen Barclay, says: "Rip-off charges have no place in a modern Britain and that’s why card charging in Britain is about to come to an end. This is about fairness and transparency, and so from next year there will be no more nasty surprises for people at the check-out just for using a card."
The move has been welcomed by consumer groups. James Daley, director at campaigning group, Fairer Finance, says: "The Treasury has gone further than it needed to by including Paypal American Express, as the EU rules only required a ban for Visa and Mastercard. Finally consumers are being given the confidence to spend money on card without worrying about getting stung on fees."