Imagine this: you’re at a local café, ready to pay for your coffee and pastry, only to be told your cash is no good here. The only option? Pay by card and incur an additional transaction fee. This scenario is becoming increasingly common across the UK, leaving many consumers frustrated and questioning the legality of such practices.
A recent reader query to a leading publication highlighted this exact predicament, sparking a vital conversation about payment fairness in modern Britain.
The Legal Tender Myth
Contrary to popular belief, the term ‘legal tender’ has a narrow technical meaning relating to the settlement of debts. For everyday transactions, businesses across England and Wales are generally not legally obligated to accept cash. They can specify their preferred payment methods before a transaction takes place, whether that's card-only, mobile payments, or exclusively cash.
This legal flexibility means that the familiar sight of ‘Card Only’ signs, particularly in smaller establishments and markets, is within their rights, however inconvenient for those preferring to pay with coins and notes.
The Card Fee Controversy
While businesses can refuse cash, charging extra for card payments enters a greyer area. Since 2018, EU-derived regulations banned retailers from charging customers extra for using debit or credit cards. Although the UK has left the EU, these rules were incorporated into UK law.
However, this ban primarily targets consumer surcharges. Businesses can still set a minimum spend for card payments or offer discounts for alternative payment methods, effectively creating a two-tier pricing system.
The Consumer's Right to Choice
Consumer advocacy groups argue that the shift towards a cashless society risks excluding vulnerable populations, including the elderly, low-income families, and those who simply prefer budgeting with physical money. The Financial Conduct Authority (FCA) monitors this space closely, emphasising the need for fair access to payment methods.
If a business does not display its payment terms clearly—such as a ‘card only’ notice or potential fees—before you make a purchase, you may have grounds to challenge the payment method refusal or any unexpected surcharge.
What Can You Do?
If you find yourself facing an unexpected card fee or cash refusal:
- Check for clear signage: Businesses should display their payment policies prominently.
- Politely question the policy: Sometimes, staff may make exceptions if asked, especially for small amounts.
- Vote with your wallet: Take your business elsewhere if you disagree with a store’s payment terms.
- Report misleading practices: If fees are hidden or terms are unclear, you can report the business to Trading Standards.
The debate between cash and card is more than a convenience issue; it's about financial inclusion and transparent consumer practices. As the UK moves further towards digital payments, the call for clearer regulations and protected access to cash grows louder.
