articles | 24 November 2021

Fines for overcharging customers paying by credit card

Authorities have said they will no longer tolerate businesses imposing hidden excess charges on customers who wish to pay with a credit card.

Draft legislation imposes a €10,000 fine for those who overcharge customers in this way.

With the use of plastic money and seamless payments rising due to the pandemic, some small retailers illegally transfer credit card processing fees to consumers.

A Finance Ministry decree also boosted the use of credit cards on September 18, compelling all businesses and services in Cyprus to accept card payments.

It applies to kiosks, plumbers, lawyers, and all retail businesses.

However, smaller businesses are transferring the processing fee to the client, arguing that they have a small margin of profit, wiped out by such fees.

It is mainly kiosks that have reportedly been charging customers a fee for paying with plastic money for items such as cigarettes, phone top-up cards and newspapers.

The House Commerce Committee plans to include a provision that will increase fines for companies still refusing to accept credit cards as payment for services and goods.

MPs want to raise the fine from €2,000 to €4,000.

Businesses should establish wireless and wired POS, mobile POS and virtual POS terminals and accept card payment from Visa, Mastercard, Maestro and UnionPay.

Recently, the Tax Department found that 100 businesses out of the 1,000 they inspected had yet to install a POS system, nor had they requested one from a provider.

The bill says the authority to monitor the proper use of credit card payment systems will be the Consumer Service under the Finance Ministry.

MPs want to finalise the bill by the end of the year and have it approved in January.

Source: Financial Mirror

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