Government to crack down on hidden credit card charges

| August 21, 2012
Government to crack down on hidden credit card charges

Tougher rules are to be brought in to protect consumers from hidden credit card charges and premium-rate phone calls to customer service departments.

The Government has launched a consultation on how to implement the changes, which are required under a European Consumer Rights Directive and will apply to countries across the European Union.

The new rules are expected to ban excessive debit and credit card surcharges and should ensure that calls to customer service helplines will be charged at the basic rate.

Airlines will no longer be able to add credit card charges after customers have already filled in pages of information online.

The rules should also help to prevent online retailers tricking customers into buying extras such as travel insurance.

Websites will no longer be allowed to automatically tick boxes for these types of items, safeguarding customers from purchasing them in error.

The new regulations should also prevent customers having to wait a long time to receive their goods as retailers will be required to deliver items within 30 days.

Protection will also be increased for consumers who buy goods or services from door-to-door salesmen.

They will have a cooling-off period of fourteen days, during which time they can cancel their purchase.

At the moment the cooling-off period is just seven days.

Meanwhile, a new report from Confused.com suggests that credit card providers are relaxing their application rules, allowing people on low incomes and the unemployed to use credit cards.

The average annual income required for a successful application was £9,718 in 2011 but has now fallen to £9,035.

The number of credit cards available to an unemployed person has increased from 17 in 2011 to 23.

Nerys Lewis, head of credit cards at Confused.com, said: ‘As credit card companies react to market conditions, lending criteria such as minimum annual income is being relaxed and card companies are having to meet demand from people on lower salaries.

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