We have heard from a number of tabs customers recently that banks are issuing notifications that they intend to start charging significantly increased fees for the use of debit cards by customers, which is causing people to look again at what they charge and how to recover their card processing costs. If you haven’t already had notification of this from your bank then you should probably expect this soon and be planning what to do as a result.
The European Union Consumer Rights Directive came into force last year and has been designed to achieve a high level of consumer protection when contracts are negotiated away from business premises (e.g. when guests book online or over the phone etc.). So if you take online bookings and payments through your website and over the phone, you should read this.
Most cottage agencies who accept payments by credit card and debit card charge a supplement for those transactions. If you are one of them then you should make sure that the credit and debit card surcharges you apply are compliant with the Consumer Rights (Payment Surcharges) Regulations 2012.
The amount that tabs customers charge their guests varies, with an average of around 2-2.5%
Here’s a quick recap:
If you can provide an invoice that identifies a separate cost only attributable to processing card payments then you can include it in your surcharge. For example:
If you simply pass on the exact amount that you are charged for processing the transaction you should be OK. But if you add on a bit extra again (perhaps to try to encourage guests to pay using another method) you can’t do that.
How did you calculate your surcharge figure in the first place? Have you reviewed your policy since changes were made to the law last year? What difference do the increased debit card charges make?
We look forward to your comments and feedback about what you are doing!