In a move which will no doubt delight consumers, the Government has revealed plans to stop companies charging excessive credit and debit card surcharges. The new regulations will also force those charging card fees to reveal the cost before consumers have clicked through a multitude of webpages.

Image by James Meikle

The new regulations follow a lengthy campaign by not-for-profit consumer group Which?. Many Which? members were unhappy about being stuck with significant extra charges right at the end of the ticket buying process. Budget airlines, rail operators and events organisers were often cited as the main culprits of this type of surprise price inflation.

Overinflated fees

In recent years it has become common place for consumers to find themselves paying as much as £12 in card surcharges on a return budget flight. As part of their research Which? set out to ascertain how much it actually costs the companies to process the card payments. They reckon that when a customer pays by credit card it costs the company between 1 and 2 per cent of the price. However, if a customer pays by debit card the cost is believed to be around 10p to 20p; meaning that a company charging £12 for a card transaction would pocket at least £11.80 of the fee.

The Which? campaign climaxed in a super-complaint being submitted to the Office of Fair Trading (OFT). The complaint was supported by 43,000 Which? members with at least 10,000 consumers also lobbying MPs to do something about the charges.

The OFT launched an investigation into the charges and recommended that the government ban debit card charges and make credit card charges more transparent. However, the government has surprised many in the industry by going beyond the OFT recommendations and announcing plans to end all profiteering on card payments by 2013. They’ve also stated that sellers will have to show the final price, including all fees, much earlier in the sales process.

War on politics or profiteering?

This move by the pro-business Conservative Government is not so surprising when you take into account the fact that the European Union was already planning to ban profiteering on all types of payments from 2014. All you cynics out there could see this is a ploy to curry favour with the public by introducing regulations which were already due to be brought in anyway. It’s even more interesting when you consider that the Government has just stolen the thunder from the EU at a time when there has been considerable tension between the UK and the EU.

Aside from travel and event tickets, where else have you seen vastly inflated card fees? How do you think the budget airlines will respond? Do you think the Government would have introduced these regulations if the EU hadn’t already made similar plans? Share your thoughts in the comments box bellow.

Image by: Natloans via Flickr

Living with a low credit rating can be worrisome and render you ineligible for loans and credit cards without a high interest rate attached. While it’s not the best thing to have a low credit score, it’s not impossible to repair your rating- if you’re willing to work at it. Consider these easy tips for improving your credit rating.

Credit cards

There are a few options with credit cards in terms of raising your credit score. First, if you already have a credit card, try your best to pay it off in full every month. If you’re not able to do this, at least make the minimum payments on time. This will show that you are aware of your debts and making an effort to pay them off.

If you don’t have a credit card, consider applying for one. Make small purchases on this card and be diligent in paying it off in full. Taking out a credit card and not ever using it will not help your credit score. They want to know you can borrow money and pay it back responsibly.

If you are currently paying off a credit card, you can still consider taking out a second card. This is risky if you are an impulse shopper! ONLY take this step if you are sure you can be diligent in using this card only for small purchases and be sure to pay it off on time every month. If you are serious about raising your score, you have to be serious about not over-spending.

Also, keep in mind that it’s not the best idea to max out your credit cards or, conversely, to cancel one. These events raise flags in your credit score, even if you have paid off the balance completely.

Debt

If you are already swimming in debt and it’s affecting your credit score negatively, it’s a good idea to make a payment plan and stick to it. Even if you are just slowly digging away at your debt, an organised and consistent payment plan will reflect positively on your credit score (though it won’t fix it completely, it’s a good first step!)

Loans

Taking out a manageable personal loan that you can easily pay off will also help boost your credit score. Unlike a credit card, you don’t necessarily have to spend the money you get from the loan- just be sure to pay it off with monthly payments.

It’s always a good idea to pay your bills- all of them- on time and in full. Also, keep an eye on your credit score. It is a reflection of your spending and financial habits and the information is available to you. It’s better to know now than be surprised later.

Do you have any credit-score-raising tips? Tell us about them in the comments below.

Image by Irish Typepad, via flickr

Since the introduction of credit cards in 1958 people have been banging on about the possibility of a cashless society. A new report has claimed that 2016 will be the year when electronic transactions will take over from cash as the main form of payment in our day-to-day lives.

But, just how could this cashless society come about? And what would it look like?

Well, there are a variety of reasons why electronic payments are nearly ready to do away with the need for coins and notes. One of the main driving factors is the desire of some major businesses to shift towards electronic payments.

It’s easy to see why companies like Visa and Paypal are fond of the idea; more electronic payments mean more business for them. But, what about the major retailers? Wouldn’t more electronic payments mean more fees for them to pay? Well, yes, but the surprising thing is that it actually costs more to handle the cold hard cash. It’s got to be counted, checked, bagged, tagged and transported. On top of all that, there are never ending issues related to forged notes. UV lights have to be installed, staff need to be trained and the supermarkets have to absorb the losses when fake notes get through.

While we’re all familiar with paying by card, it can still feel a bit slow and awkward when you’re paying for something small. I’ve certainly experienced a little embarrassment when paying for a £1 bottle of juice by card. There’s a strangely uncomfortable little moment when both you and the cashier are waiting for the chip and pin terminal to get itself ready; you try and zone out for a few seconds while they look at you and think ‘woah, there goes  Mr Moneybags putting another megabucks purchase on the goldcard’.  And, annoyingly, there’s not even really enough time to lighten the mood with a little banter. All that is bad enough, just pray you don’t have to go through it in a busy petrol station during rush hour. You can actually feel the temperature rise as the rage boils up within the hoard of angry motorists behind you. You can almost hear them think ‘How dare he lengthen my arduous commute faffing about with his card. And he’s not even buying fuel, the damn swine! Mark my words, he’ll pay for this!’

…Anyway, all that could soon be a thing of the past. Technology seems to finally be catching up with the dreams of the retailers and payment companies. They reckon that Near Field Communication (NFC) is the future of these petty little payments of less than £15 (any more and you’d need to use a pin number too). NFC doesn’t actually have anything to do with shouting at farmers; it’s really all about being able to swipe your mobile over a payment terminal for a quick and effortless transaction.  I can see the future now… people will have their own little swiping styles: you’ll have the swingers, the flickers, the sliders and many more.

But, what would happen if you wanted to lend a friend a few quid? Simple, you’d text them it of course!

With a rapid growth in the number of NFC terminals, many of the mobile phone manufactures getting on-board and interest from major online players like Google, it can only be a matter of time before the sight of cash becomes a rare occurrence. Cash will always have its place though, could you imagine your gran texting you some money on your birthday?

Do you like the idea of a cashless society? Would you be a swinger, a flicker of a slider? Let us know in the comment box below.

Image: Images_of_Money

We’ve had over a decade to get used to the idea of online shopping, and these days it’s almost a necessity for getting the items you want. However, transactions over the computer have also brought with them a whole new list of ways that crooks can get between you and the stuff you want. Here are a few tips to remember to keep your money safe in your bank account:

1. Always, always, always keep your antivirus software up to date and make sure you only download programmes from reputable sites. Hackers sometimes use programs like keyloggers to obtain credit card numbers direct from the machine.

2. Check to make sure the site is legit. Then check it again. Even a well-designed site can be set up as a front for a scam operation, so looking at reviews and affiliated sites can help establish its legitimacy, especially for independent retailers (this is where buying from independent retailers with a large reputable third-party sites such as Etsy can be a good idea). See if the site advertises its security software too for extra peace of mind. For the seriously diligent, get a physical address with telephone number and try calling that.

3. A company using a free email service for its official email address can sometimes be a red flag. To check it out, it can be worth sending an email to them before purchasing to make sure that the email displayed isn’t a throwaway account.

4. It’s a good idea to have a debit card dedicated to online purchases. This restricts you from being able to order internationally, of course, but it can be worth the hassle to avoid the mess of sorting out a stolen primary credit card number.

5. Pay attention to where links are directing you. Phishing scams are pretty well known by now as a way for hackers to gain information ranging from passwords to bank account numbers. Basically, if you get an email telling you to log in to your bank account for whatever reason, make sure the URL the link goes to is the official link your bank uses.

6. Have a single place to write down all your credit cards, account info and card issuer’s contact number. That way, if you notice anything strange on your statements, you can get the card cancelled right away rather than wasting time trying to gather all the information you need.

As of the 27th Google Checkout will stop accepting Maestro cards. Maestro is run by Mastercard. Mastercard credit cards are unaffected and can still be used. There are more than 500 million Maestro debit card holders around the world and so this is a significant move from the Googleborg.

It’s odd that Google would want to ditch the card. It’s also odd the Google are doing this at such sort speed. In the last week they’ve been sending out this email.

Thank you for using Google Checkout, the fast, secure way to shop at stores across the web.

As of 27th July, Maestro cards will no longer be accepted as a payment method by Google Checkout. You are receiving this notification because your default card is a Maestro card that will no longer be supported.

To ensure that your Checkout account is ready for purchases the next time you shop, you will need to select a new default credit/debit card. Accepted payment methods are listed at http://checkout.google.com/support/bin/answer.py?hl=en-uk&answer=105916

You may update your payment information now by clicking ‘Edit payment methods’ after signing in to your Google Checkout account at http://checkout.google.co.uk

If you prefer, you also have the option of updating your payment information when you make your next purchase.

While you will be unable to place new orders with Maestro cards, refunds and chargebacks for previous orders will be unaffected.

We apologize for any inconvenience. If you have any further questions, please visit our Help Centre at https://checkout.google.com/support/?hl=en-GB

Kind regards, The Google Checkout Team

As savvy Cashzilla readers will know there are certain risks in storing too much money in sites like PayPal. If someone tricks you out of your password or the company decides to freeze your account then you’re in trouble.

Purchases made this way don’t have the same sort of protection as direct credit card purchases either. Most of all; if you store money in PayPal then it’s not in the bank earning interest.

This call by a major political party came in a white paper on the subject of banking reform, not only criticised bank charges, but also stated they would force credit card, overdraft and mortgage charges to be clearly visible to bank customers.

According to the Tory’s, “There have been numerous examples of unfair treatment of consumers – the mis-selling of payment protection insurance and unfair bank charges.”

Alan O’Sullivan, banking and credit card correspondent at This is Money commented: “The fact that a major political party has come out and branded bank charges unfair should be celebrated although, given the legal case on charges is now in its latter stages, they could have stepped in sooner.”

As the legal row over the legality of bank charges for unauthorised overdrafts hit the House of Lords last month, the additional pressure from a mainstream political party will hopefully provide a boost to the calls by consumer groups who had hoped the banks would accept the appeal court’s original ruling.

As the chief executive of Which?, Peter Vicary-Smith, said to the Guardian last month: “It is disappointing that nearly two years since this saga began, little has changed for the millions of consumers being hit with these charges.”

He added: “If you’re struggling with basic living costs such as rent and utility bills then you may be eligible to get your claim fast-tracked under the terms of the waiver. The FSA must take action against any bank ignoring the financial plight of its customers.”

Now if only the government would listen and lodge their support too.

Growl.