Credit card fees ban backfires as consumers face new ‘service charges’ and higher prices

A Telegraph survey of ­businesses and councils which ­currently charge consumers for using credit cards found the vast majority will continue to do so right up until the January deadline.

Ryanair charges customers a fee of 2 per cent of their purchase price for ­using a credit card. The airline said it will comply will the new ban.

EasyJet previously charged a 1 per cent fee for purchases made using a credit card but ceased to do so on the 14th December.

Warwick District Council, Buckinghamshire County Council, Derby City Council, Barnet Council and Ealing Council will all charge fees of between 1 and 2.5 per cent until the deadline.

However, it has also emerged that thousands of shops and businesses ­unable to absorb the cost intend to raise the price of items on shelves or ­refuse small card payments, according to the Federation of Small Businesses, which represents firms.

Speaking confidentially to this newspaper, an employee at a travel firm – which currently charges customers to pay with credit cards – also said the company had decided to raise prices to make up for lost revenue.

He said: “We agreed to increase all our prices by whatever amount we ­calculate which we estimate will cover the cost of the fees we are charged by Visa, Mastercard and American ­Express. We estimate that removing the surcharge will result in a significant shift away from payments by debit card and bank transfer so the increase [in extra costs] will be greater than the current credit card surcharge.”