Credit Card Invoices

Question

Asked by

To ask His Majesty’s Government what plans they have, if any, to require credit card issuers to provide a full description of goods or services provided on their customer invoices.

My Lords, while issuers are not obliged to provide full a description of goods or services, there is existing legislation governing customer transactions. This requires customers to be given a statement of their transactions at least monthly. Under the rules, providers must include a reference to help the customer to identify the transaction, and, where appropriate, information relating to the payee.

My Lords, I am very grateful to my noble friend for that Answer, and also for allowing me to brief her on what I felt was the problem, but I am afraid her Answer does not satisfy me at all. How many Members of your Lordships’ House when they receive their credit card slip find transactions which they simply cannot recognise at all, for £5, £10 or maybe £15? How many times do noble Lords go on the fraud line and find, after quarter of an hour sitting there, that they have to put the phone down because they can go no further? Would the Government not agree this must be an incitement of low-level but quite extensive fraud, which is likely to get worse as we do more tap-and-go transactions and less in cash? Would it not be a good idea if it was a requirement to put on the credit card entry the name of the customer, the postcode that they operate from and a two or three-word description of the product or service provided?

My Lords, payments are governed by the Payment Services Regulations. The Government published a call for evidence in January 2023 to test whether the regulations are meeting their aims. The Government did not receive any evidence that would imply that more specificity would be helpful, either for customers or in terms of tackling fraud. However, I say to my noble friend—and I appreciate him raising this issue—that, as part of the smarter regulatory framework, firm-facing requirements will be repealed and replaced by rules from the FCA. Of course, this may be something that we can take forward in the future.

My Lords, we discussed last week concerns that the new generation of touch-screen card readers lack essential accessibility features needed by blind and partially sighted people. Looking into this further, it seems that these readers can also come with other issues, whereby if they are not correctly configured, the only description of transactions that appears on statements is the name of the machine manufacturer rather than the retailer you shopped with. Can the Minister see a case for steps to ensure payment devices are correctly configured, so that transactions can be more easily traced?

I agree with the noble Lord that those payment machines should be correctly configured. When customers realise that there is a problem, they must raise it with the bank, which will then be able to take further action. It is the case that if there is any suspicion of fraud—whether using a credit card or a debit card—the customer can get their funds back.

My Lords, we are rightly discussing regulations for credit cards and consumer credit, but an increasing amount of consumer credit is coming from the buy now, pay later app sector, which is unregulated. Does the Minister understand how lopsided that is? It is time that the Government looked into regulating buy now, pay later, so that people have equal safety on both sides of the consumer credit barrier.

The Government are considering responses to a recent consultation on draft legislation for buy now, pay later. The Government believe that any regulation of this area must be proportionate, because buy now, pay later can be very useful to a large number of people. There are existing protections in the Consumer Rights Act, and the FCA has powers over the terms and conditions of the buy now, pay later contracts.

My Lords, I declare my financial services interests as set out in the register. Does my noble friend agree that, whether paying with a credit card or a debit card, one should be able to do so in an accessible manner? That will happen only if all financial services products and card payment machines are designed with inclusion in mind right from the outset.

I am grateful to my noble friend for raising this issue again. As I mentioned last time, there is now a consumer duty, which is a very important underpinning for financial services providers, which have a duty of care for their customers. That came into effect on 31 July 2023, and the Government and the FCA will monitor the effectiveness of the consumer duty as it beds in.

Does my noble friend agree that the Government have a lot more to do, in the spirt of full disclosure, in explaining the cost of Covid and the lockdown? The latest estimate is that it has already cost over £400 billion. With all the excess deaths and, in particular, mental health issues we are now experiencing, that cost will grow. Would it not be sensible to explain far more fully to everybody in this country the costs to them? That means that there would be no more magic money tree and that the Treasury’s pre-Budget leaks would be much more realistic. Furthermore, we would be much better placed to decide, if there were to be another epidemic, what we should be doing.

My noble friend is quite right. He may have heard some of the explanation I gave in the debate on the Spring Budget on why we had to take the decisions that we did. Noble Lords will all recall that the Government stepped in to provide furlough for nearly 11 million people to save their jobs and protected nearly 500,000 businesses. It was essential that we did that at the time, but it came at a cost to our economy and society, which must be repaid at some stage.

My Lords, last week I invited the noble Baroness to dinner, if we could find a restaurant with an accessible payment device. That evening, I went to a restaurant that had purchased a cover that made the device accessible. I have been in correspondence with the Minister since and am very grateful for her interest. Could we not simply make all providers offer that service, rather than restaurants having to buy it in?

I am interested to know if that is the restaurant that the noble Lord intends to take me to. I have been in correspondence with him since last week. We will work very closely with UK Finance as its finishes off its accessibility forums to understand what more can be done to ensure that payment devices are accessible.