Holidays for Brits are set to get cheaper as 'misleading' charges for debit and credit cards face the axe.
The Office of Fair Trading ruled yesterday that airlines and rail companies should not charge customers any extra if they use debit cards . And it called for credit card charges to be 'transparent', and included in headline prices.
The move has been hailed a 'victory for consumers', the OFT threatened legal action against firms who don't comply.
The watchdog called on the Government to completely outlaw surcharges on debit cards, saying they were the 'online equivalent of cash'.
Last year Britons spent £300 million on surcharges for air travel alone. Some airlines charge up to £8 for the use of a debit card and up to £10 for a credit card.
The OFT said the costs of debit transactions were negligible, but acknowledged that travel companies did incur a cost for processing credit card payments.
But If they pass this on to customers, the costs must be included in the headline price.
According to the OFT, customers booking on some websites were only told of the extra charges after filling in several pages. It said this 'drip pricing' was 'misleading to consumers when it comes as a surprise'.
Cavendish Elithorn of the OFT told the Express: 'People are frustrated about being asked to pay for paying. Surcharges are a particular problem online where you can't switch to cash or cheque.'
Consumer minister Edward Davey said: 'We will work with the OFT to make sure consumers do not have to pay excessive surcharges.'
The OFT investigation came after a complaint by consumer group Which?
Monarch Airlines abolished debit card charges earlier this year, saying there was 'no justifi cation', but charges £10 for credit card transactions.
Ryanair says its charges of £6 per journey for credit and debit cards are avoidable.
A spokesman said: 'Ryanair is one of the only airlines to provide access to fees information directly from its home page, where it is clearly explained that Ryanair's avoidable administration fee may be charged to defray the substantial costs associated with our booking system.'
Easyjet doubles its debit card booking fee
Which? launches campaign against excessive card fees