The Second Payment Services Directive (PSD2) sets rules for online payments and financial services in Europe. One key rule is the ban on adding surcharges for card payments, which affects EEA-based businesses.
This article explains the PSD2 surcharge ban, why it exists, and how it applies to your business.
The surcharge ban
The PSD2 surcharge ban, effective from January 13, 2018, applies to all businesses in the European Economic Area (EEA) and prohibits extra fees on debit or credit card payments. Each country has the authority to decide how to implement and define the rules.
In the UK, the Treasury extended the ban to cover PayPal transactions. The ban applies to payments made via all major card providers (e.g., Visa, Mastercard, etc.).
What should I do?
At Bookwhen, booking fees apply to all payments, both online and offline. This helps ensure the same fee applies regardless of how a customer chooses to pay, which may support compliance with surcharge rules in some regions.
Adding booking fees for all payment types
To add a fee to all bookings:
Select Edit in the Booking fees section:
Tick the Add a booking fee checkbox:
Enter the fee details:
Fixed fee: A set amount (£x) per booking.
Percentage fee: A percentage of the booking cost added alongside the fixed fee (x%).
Select Save to save your changes:
Increasing ticket prices
If you'd prefer not to set a fee, you can adjust your ticket prices to account for both online and offline payments. However, please keep the following in mind:
It can be difficult to cover the fee entirely because payment providers have a precise charging structure (flat fee + percentage per transaction).
Striking the right balance between covering costs and avoiding overcharging customers can be challenging, so proceed carefully when adjusting your prices.
Guidance for UK businesses
From the UK Gov Site Document
9.1 What can be charged ✅
Surcharges can only reflect costs directly incurred by the trader for using the payment method in question. For card payments, legitimate surcharges may include:
Merchant Service Charge: The fee businesses pay to their payment service provider, which includes the interchange fee paid to the card issuer, the fees paid to the scheme (e.g., Visa or Mastercard), and the margin retained by the payment service provider to cover costs and profit.
Transaction/Overhead Fees: Fees paid by the business to intermediaries for merchant services provided by the payment service provider. This is when an intermediary acts as a point of contact for the business, charging a markup on the payment service provider’s fees.
9.2 What can’t be charged ❌
The government specifies that a surcharge cannot include the general costs of running a business, such as administrative overheads, staff training, equipment installation, or setup fees.