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Adding a fee when a customer pays by card feels like a fair way to cover your processing costs, but for consumer cards it has been against the law in the UK since 2018. Get it wrong and you risk complaints and enforcement. This guide explains the card surcharge ban, what you can and cannot do, and the legitimate ways to recover your costs.
In short. Since January 2018 UK businesses cannot charge consumers extra for paying by debit or credit card. You can still cover your costs, but through your pricing rather than a card surcharge. A few options remain open, such as building costs into prices, setting a minimum spend, or offering a discount for other payment methods.
Rules that took effect on 13 January 2018 made it unlawful for businesses to add a surcharge when a consumer pays by card. Before then it was common to see a fee added at the till or checkout for paying by card, often dressed up as a card handling charge. That practice is no longer allowed for consumer debit and credit cards.
The aim was to stop hidden fees appearing at the point of payment, so the price a consumer sees is the price they pay however they choose to pay. It applies whether you sell in person or online.
✗ Add a percentage or flat fee for paying by consumer debit or credit card.
✗ Add a card handling charge at the checkout that only applies to card payers.
✗ Route around the ban by labelling a card fee as something else while it still only hits card users.
The ban stops you charging consumers extra for using a card. It does not stop you covering your costs sensibly.
Build costs into your prices. The simplest and most common approach. Your headline price reflects the cost of doing business, including card fees, and everyone pays the same.
Set a minimum card spend. You are generally allowed to set a minimum transaction value for card payments, which protects you from tiny sales where the fee eats the margin.
Offer a discount for other methods. A discount for paying another way is treated differently from a surcharge, so incentivising an alternative can be acceptable where a penalty is not.
A surcharge that breaks the rules is not just a technical slip. Customers notice, complain and can report it, and enforcement sits with trading standards. Beyond the legal risk, a fee at the point of payment is one of the most common reasons a sale is abandoned, so even where a business thinks it is protecting margin, it may be quietly losing custom.
If you currently add anything extra when a consumer pays by card, remove it. The right way to recover card costs is through your pricing, not a surcharge, and it keeps you both compliant and easier to buy from.
The consumer surcharge ban is focused on consumer cards. The position on commercial and corporate cards is more nuanced, and rules can change, so if a meaningful share of your customers pay on business cards it is worth checking the current position rather than assuming. For most retail and service businesses dealing mainly with the public, the safe rule is simply not to surcharge card payments at all.
1. Check your tills and checkout. Remove any card fee, card handling charge or similar that applies to card payers.
2. Review your pricing. Make sure your prices cover your costs, including card processing, so you are not tempted to add a fee.
3. Consider a minimum spend. If small card sales hurt, set a sensible minimum rather than surcharging.
4. Lower the cost instead. If card fees are the pressure, compare providers and pricing models, which is where the real saving sits.
The surcharge ban often frustrates owners who feel they are absorbing a cost they did not create. But it is worth reframing. A surcharge only ever moves the cost onto the customer at the least welcome moment, right at the point of paying, which is exactly when a sale is most likely to fall through. Removing it usually helps conversion, not just compliance.
The real answer to card costs is not to pass them on but to lower them. Most small businesses are on a blended rate that quietly includes a comfortable provider margin, and few ever review it. Comparing pricing models and providers, checking your effective rate across a real month, and cutting any non compliance or minimum fees will do more for your bottom line than a surcharge ever could, and it keeps you the right side of the rules.
Not for consumer debit or credit cards. Adding a surcharge for paying by card has been banned in the UK since January 2018.
Generally yes. A minimum spend for card payments is treated differently from a surcharge, and it protects you from tiny transactions where the fee eats the margin.
Offering a discount for paying another way is treated differently from penalising card payers, so it can be acceptable where a surcharge is not.
Yes. The rule applies however a consumer pays, in person or online, so a card fee at an online checkout is caught too.
Through your pricing, by building the cost in, and by keeping the cost low through comparing providers, rather than by surcharging customers.
Customers can complain and trading standards can take enforcement action. A customer is also entitled to be refunded any unlawful surcharge they were charged, so beyond the regulatory risk you can simply be made to hand the money back. For the sake of a small saving, it is not a risk worth taking.