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Banks: Credit Cards

House of Lords written question – answered on 7th July 2011.

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Photo of Lord Stoddart of Swindon Lord Stoddart of Swindon Independent Labour

To ask Her Majesty's Government whether, in the light of the ruling from the Office of Fair Trading regarding charges for consumers using credit and debit cards, they have any powers to introduce an immediate ban on charges levied by banks or other institutions for the use of credit cards to purchase goods and services, given that those cards are promoted as being an alternative to cash.

Photo of Lord Sassoon Lord Sassoon The Commercial Secretary to the Treasury

Under the Consumer Credit Act 1974, the Courts can reduce the charges on credit cards if they consider that the relationship between the creditor (for example, a bank) and debtor (for example, a customer) is unfair.

As regards charges levied by retailers on customers who pay by credit card, the Payment Services Directive (2007/64/EC) provides that member states may forbid or limit the right of the payee (for example, a retailer) to impose charges for the use of any payment instrument (including credit cards), taking into account the need to encourage competition and promote efficient payment instruments.

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David Wright
Posted on 12 Jul 2011 12:38 pm (Report this annotation)

So, they can, but will they?