Brits hit by over a billion pounds worth of hidden fees a year
Press Release - 12 December 2015
New research reveals that Brits are hit by £1.2 billion worth of hidden fees every year. From booking fees to an unexpected service charge added to a restaurant bill, people across the country are being stung by additional charges, often sprung at the last minute.
The study by guarantor lender Amigo Loans, which drew on the experience of 2000 UK adults, found that fees charged by 0845 and 0870 telephone numbers have affected the most people in the last year. Nearly 12 million Brits have experienced a sting in the tail from 0845 numbers, accumulating in over £714m worth of shock phone bills.
This was closely followed by charges for using your credit card to purchase products online. In the last year 11 million people have been subject to a charge for paying by credit card online, equating to over £13million in extras being paid.
People preparing for their Christmas holidays or New Year getaways aren’t exempt either, with many being caught out by a sneaky hidden charge for checking in luggage or choosing a seat on a flight. In the last year the UK has paid out a total of over £90 million in luggage fees to airlines which can charge up to £25 for checking a bag in the hold for a one way journey.
With panto season upon us, many will have had the shine taken off their excitement by the inevitable 11% booking fee. These booking fees, now commonplace when purchasing tickets for, shows, festivals or gigs, cost Brits more than £103m every year.
Other fees that can sneak into your outgoings include bills from your bank for simply communicating with you. Opting for paper bills instead of online bills for example costs Brits an average of £1.69 per month. This has affected one in ten people in the last year which amounts to a staggering £79.5m each year.
The top hidden charges faced by Brits are:
| Hidden fee | % |
|---|---|
| Non-mobile friendly numbers 0845 and 0800 (e.g. extra 20p per minute) | 30% |
| Using a credit card to make a purchase online (e.g. extra 1.25%) | 28% |
| A surprise booking fee when buying tickets (e.g. 10% extra of the face value of your ticket) | 23% |
| A service charge at dinner which wasn't made clear on the bill (e.g. extra 12.5%) | 22% |
| Luggage fees for flights | 17% |
| Overdraft fees (e.g. extra £10) | 17% |
| Surcharge (e.g. extra £2.50 per week) for opting for paper bills from your bank | 10% |
| Free trial fees | 10% |
| Amendment fees on legal documents (e.g. approx. £15) | 6% |
| Moving house early (e.g. paying up to an extra £100 to end your tenancy) | 3% |
Glen Crawford of Amigo Loans, which commissioned the study said:
"People encounter hidden fees all the time in everyday life – but just because we are used to them doesn’t make them acceptable. People should be able to see exactly what they are paying upfront and should never get a sting in the tail from a sneaky fee thrown in at the last minute or weaved into the small print."
He added: "Some people even face charges for paying down debts early and in my opinion borrowers should be rewarded not penalised for this. At Amigo, we never charge for late payments, letters, early settlement or anything else. What you see if what you get, honest, flexible and straightforward borrowing".
Notes to editors:
All figures unless otherwise stated taken from research by OnePoll Research in June 2015, weighted to nationally representative criteria across 2,000 UK adults.
*Table detailing number and costs below (UK adult population - 39700000)
| Choice | % | No. affected | Fee (£) | Fee explained | Total cost | References |
|---|---|---|---|---|---|---|
| Luggage fees for flights | 0.17 | 6,788,700 | 13.60 | £13.60 | £92,326,320 | Link |
| Using a credit card to make a purchase online (e.g. extra 1.25%) | 0.28 | 11,056,450 | 1.20 | Average spent on card online per transaction - £96.10 a 1.25% charge = 1.20p | £13,267,740 | Link |
| A service charge at dinner which wasn't made clear on the bill (e.g. extra 12.5%) | 0.22 | 8,734,000 | 2.58 | Average cost of dinner in a restaurant - £20.66 with a 12.5% surcharge = £2.58 | £22,533,720 | Link |
| A surprise booking fee when buying tickets (e.g. 10% extra of the face value of your ticket) | 0.23 | 9,091,300 | 11.40 | Average festival ticket - £103.66 with a 11% surcharge = £11.40 | £103,640,820 | Link |
| Surcharge (e.g. extra £2.50 per week) for opting for paper bills from your bank | 0.10 | 3,771,500 | 20.28 | Average cost of a paper bill is £1.69 a month = £20.28 a year | £76,486,020 | Link |
| Amendment fees on legal documents (e.g. approx. £15) | 0.06 | 2,481,250 | 21.00 | Average cost for amending a car insurance policy - £21 | £52,106,250 | Link |
| Overdraft fees (e.g. extra £10) | 0.17 | 6,828,400 | 17.50 | Average overdraft fee - £17.50 | £119,497,000 | Link |
| Free trial fees | 0.10 | 4,108,950 | 5.99 | Using Netflix and Amazon as an example: both charge £5.99 a month after the 'free trial' if you don't end your subscription officially | £24,612,611 | Link |
| Non-mobile friendly numbers 0845 and 0800 (e.g. extra 20p per minute) | 0.30 | 4,108,950 | 60.19 | Average call length 10 minutes with 27.36 calls a year = 274 minutes spent on the phone to 08 number per year - average call cost per min = 22p - £60.28 per year | £714,473,357 | Link |
| £1,218,943,838 |
