Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment his Department has made of the impact of (a) removing credit charge surcharges on businesses selling high-value items and (b) policy on the price of consumer goods and services as businesses raise prices to cover the fees charged to them by credit card companies.

Surcharging, the practice of charging a fee for using a certain payment method, is banned in the UK for payments made by consumer credit and debit cards. This ban was introduced through amendments made to the Consumer Rights (Payment Surcharges) Regulations 2012 by the Payment Services Regulations 2017. It remains the individual merchant or retailer’s choice whether to set a certain ‘minimum spend’ for a certain type of payment instrument, and whether to accept or decline any payment method.

Regarding the cost of card payments more generally, the Payment Systems Regulator (PSR) was established with statutory objectives to ensure that payment systems are operated in a way that considers the interests of all the businesses and consumers that use them, and to promote effective competition between payment systems and services.

The PSR continues to assess the effectiveness of the card-acquiring market for merchants and consumers. On 3 November 2021 the PSR published its Card Acquiring Market Review, examining how effectively the provisions of card-acquiring services are working for merchants, and ultimately consumers. The PSR has since released a Consultation on potential remedies to the problems it identifies. In its Review, the PSR recognise card fees as one area of concern, and have confirmed an additional phase of work to investigate the matter further. The PSR states that it will intervene to address any identified issues as necessary.