Can a Business Charge a Card Payment Fee?
With card fees eating into margins, it is tempting to add a small charge when a customer pays by card. But in the UK, the rules on this are strict and often misunderstood, and getting it wrong can land a business in trouble with Trading Standards. This guide explains clearly whether a business can charge a card payment fee, what the surcharge ban covers, what you can still charge, and the compliant way to recover your costs.
Can a business charge a card payment fee in the UK?
For consumer cards, no. Adding a fee because a customer pays by personal debit or credit card has been banned since 13 January 2018. For genuine commercial cards, a fee is still allowed, up to your actual cost.
This means a shop, restaurant or website cannot add a flat "card fee" or a percentage at checkout when a customer pays with a personal card. The ban applies in store, online and over the phone, and it also covers card-based wallets like Apple Pay and Google Pay where a consumer card sits behind them.
What is the card surcharge ban?
It is the rule that stops businesses charging consumers extra for their choice of payment method. It comes from the Consumer Rights (Payment Surcharges) Regulations 2012, strengthened by the Payment Services Regulations 2017.
The aim was to stop people being hit with surprise fees only at the final step of paying. A crucial detail is that the ban follows the payment method, not the buyer. So a sole trader buying for their business on a personal card still counts as a consumer transaction, and the ban still applies. The only way a surcharge on a card is allowed is if it is a genuine commercial or corporate card.
What counts as a surcharge?
Any extra charge tied to how a customer pays, rather than what they are buying. The name you give it does not matter.
That includes a flat fee at the till, such as 50p for paying by card, a percentage added at an online checkout, a "card handling fee", or even a "cash discount" that is really just a penalty for paying by card in disguise. Calling a charge a handling fee or service charge does not make it legal if it is triggered by the customer choosing to pay by card. A fee that genuinely applies no matter how someone pays, like a uniform booking fee, is treated differently, as long as it is clearly shown upfront.
What can you still charge for?
You can surcharge genuine commercial cards, and you can charge for some other payment methods, but only up to what it actually costs you to process them.
| Payment method | Can you surcharge? |
|---|---|
| Consumer debit and credit cards | No, banned since 2018 |
| Card wallets backed by a consumer card | No, treated the same as the card |
| Genuine commercial or corporate cards | Yes, up to your actual cost |
| Other methods such as cheque | Yes, but only up to your actual cost |
Any permitted surcharge must reflect your real cost of processing that method and cannot be inflated. Keep records that support whatever figure you use.
What about minimum card spends?
A minimum spend, such as "card payments over 5 pounds only", is generally lawful under UK consumer law, though it can conflict with your card scheme agreement.
The surcharge ban does not stop you setting a minimum spend or declining to accept a particular method. However, card scheme rules, the terms you agree with Visa and Mastercard through your provider, often discourage or prohibit minimums. So while the law allows it, your provider agreement may not, which is worth checking before you put a sign up.
The compliant way to cover card costs
Rather than surcharge consumers, build your costs into your prices, or better still, reduce the rate you pay in the first place. A fairer processing deal beats a risky surcharge every time.
Most businesses are better off with one clear price across every payment method, which keeps you compliant and keeps the checkout simple. And the most effective way to protect your margin is not to claw fees back at the till, but to make sure you are not overpaying to begin with. If your rate is high, our guides on card machine fees and cash vs card show where the real savings are.
Card payment fees: FAQs
Is it legal to charge customers a card fee in the UK?
No, not for consumer cards. Surcharging personal debit or credit cards has been banned in store, online and by phone since 13 January 2018. You can still surcharge genuine commercial cards, up to your actual cost.
What counts as an illegal card surcharge?
Any extra charge triggered by a consumer paying with a card, even if it is called a handling fee or service charge. A flat card fee, a percentage at checkout, or a card-only "cash discount" all count.
Can I charge a fee for business or corporate cards?
Yes. The ban only covers consumer cards. You can surcharge genuine commercial cards, provided the fee does not exceed your actual processing cost and you disclose it upfront.
Does the ban apply if a sole trader pays with a personal card?
Yes. The rule follows the payment method, not the buyer. A personal card is always a consumer transaction, even when used for business, so the ban applies.
Can I set a minimum card spend?
Under UK consumer law a minimum spend is generally allowed. However, it may breach the card scheme rules in your provider agreement, so it is worth checking before applying one.
What is the best way to cover my card processing costs?
Build the cost into your prices with one clear price for all payment methods, and make sure you are on a fair processing rate. Reducing your rate is more effective and lower risk than surcharging.
Tempted to add a card fee because your rate feels high? There is a better way. Get a free, no-obligation statement review and we will show you whether your rate can come down instead.
Get my free statement reviewThis article is general information, not legal advice. For your specific situation, check the current government guidance or take professional advice.