London, Jul 19 (AFP) The British government today said it would ban companies from charging consumers for paying by debit and credit cards, as the country struggles to bring down its debt.

“This is about fairness and transparency, and so from next year, there will be no more nasty surprises for people at the check-out just for using a card,” Economic Secretary to the Treasury, Stephen Barclay, said in a statement.

Consumers making purchases in Britain are being asked to pay up to 20 per cent more on their bills, such as for flights, for using a card rather than cash, the Treasury said.

“With many feeling the squeeze in the cost of living, people shouldn’t be hit with unexpected fees,” said Guy Anker, managing editor at consumer website,

But he cautioned that following the change, some companies would likely raise prices of their goods and services “to compensate for the loss, which could hit those who currently pay in cash”.

Currently, businesses face charges from card companies for non-cash transactions.

According to the Treasury, the total value of surcharges for debit and credit cards was an estimated 473 million pounds in 2010.

“This action forms part of our wider help for families with the cost of living by helping to raise their incomes and keep more of what they earn,” the Treasury said.

Britain’s economy is slowing as high inflation and low wage growth cuts consumer spending and raises household debt.

The Bank of England last month noted that UK consumer credit for items such as cars jumped by 10.3 percent in the year to April, or much faster than growth in household incomes.

Meanwhile in May, union umbrella group, the TUC, said in a report that unsecured, or non-mortgage, debt per household would reach a record high of 13,900 pounds this year (USD 18,118, 15,708 euros).

Britain’s Conservative government is meanwhile struggling to bring down the national deficit and debt, which ballooned following the global financial crisis that sparked bank bailouts.

The government borrowed around 50 billion pounds in the financial year to April 2017. (AFP)

This is published unedited from the PTI feed.