I enjoyed the recent thread re: currency conversion/atm charges by banks and credit card companies. Here's a related question - It is my understanding that British merchants are now allowed by law to add a surcharge onto credit card purchases. I've tried to do some research on this, but I can't find much info. Does anyone have any info as to how prevalent this is / how many merchants do it / etc.?

It costs them between 2% and 4% to process credit cards so they look for ways to recover this. Many include the surcharge in the prices and offer a discount for cash. This is a good solution. <BR> <BR>But for small B&Bs, etc - they often tack on a small fee if you want to pay by credit card.

This is true - but I've never come across it in any shop. The larger stores, hotels, etc would lose too much business by doing this. <BR> <BR>However, some smaller businesses may charge you the extra, because they get charged themselves and when they are not making a fortune it can eat into their profits. Having said that, I've only ever come across this once from personal experience - in a small seaside B&B. <BR> <BR>More common is that some places will insist on a minimum spend before they will accept a card as payment - usually £5 or £10, but they won't charge you for using the card. Again, this is not likely in the larger establishments

What Anna says is true. If someone wants to add a surcharge, they have to inform you beforehand and in actual fact I have only known black taxis in London charge for using a credit card. <BR> <BR>More likely is that small businesses (small shops and pubs) will state a minimum transaction of normally £10.

The small hotel we stayed at in London last year had a large clear sign that if you used visa they would add 2% and amex 4%. Obviously these are the rates the card companies charge them. The nearest atm was about 50 feet from the hotel, so no big deal.

Yes, for a few years businesses in UK have been allowed to levy a charge for using credit card, either a flat fee or a percentage (commonly 2-3%). If you use a debit card, you don't normally pay a fee. While they CAN charge, many do not because of competition and the fear of losing business. So I know of no national chain-stores where you pay more for using a card. As others have said, you find it in smaller places, 'mom-and-pop' type stores and where margin is extremely tight, like in box-shifter computer stores. Also travel agents and tour operators usually charge, and for booking on-line with budget airlines like easyJet, Buzz and Ryanair (usually a flat fee of GBP3-4).