New Credit Card Rules Introduced, and Small Businesses Aren’t Happy
15th January 2018.
From Saturday, retailers will be banned from charging an extra levy on purchases made with a credit card. While this is yet another blow to the already-shaky finances of high street retailers, the Credit Protection Association encourages our members to take it in their stride. While this may push up prices in the short-term, this will encourage a shake-up of how businesses charge customers, hopefully finding a way that suits both sides of the counter.
HM Revenue and Customs (HMRC) has recently made it illegal to charge an extra fee for credit card purchases.
These new credit card rules were described by the government as a clampdown on “rip-off card charges” that were “unfair for millions of people across the country”.
This will be good news for consumers, who had reportedly paid £166 million in 2015 on ‘surcharges’.
The Federation of Small Businesses (FSB) acknowledges that this may have a short-term impact on small businesses, but insists innovation could be encouraged.
Several European banks have already launched alternatives to credit cards, such as peer-to-peer payment apps, which allow consumers to pay people and businesses directly from their accounts. Furthermore, Barclays has launched Pingit in the UK, DNB has created Vipps in Norway and ING has introduced Payconiq in Belgium.
This follows another recent HMRC shake-up, where it banned the use of credit cards when paying off a tax return. The FSB has criticised this decision, citing its impact on small firms, where other payment methods will prove too expensive.
Retailers are having a tricky time at the moment. With one commercial liquation after another, and consumer spending continuing to drop, this new shake-up is yet another slap in the face. Here at the Credit Protection Association, we encourage all our members and potential members to see these new credit card rules as an opportunity, an opportunity to change your business for the better. Think of new ways to pay your customers, and how it might benefit them rather than charging an extra levy. And to bypass any negative impact from the tax authority’s new rules, come to CPA to clear out your cash flow from any bad debts or late payers who are holding you back. Get in touch with us for our help and advice!
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
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