Absolutely ridiculous surcharging

[medhead]

I read a few weeks ago, an article mentioning CabCharge fees.
I don't remember the source, but it was along the lines of 50% of the fee going to CabCharge to cover the cost of the service and card processing, and 50% to the taxi driver as an incentive to accept credit cards. (With the logically false assertion that if the driver didn't receive that incentive to accept credit cards, no driver would due to the cost of doing so).

The taxi industry us a funny business. The owner of the cab does have to pay of the terminals placed in the cab and they probably also pay to use the system and maintain the equipment. It is common that drivers share operating costs or in some cases may even pay for all operating costs.

Having said that one allegation made was the cabcharge were giving away terminals for free on the condition that rival terminals were not installed. Given that allegation it is difficult to know the situation with any one taxi.


Sent from my iPhone using Aust Freq Fly app so please excuse the lack of links.

 

[serfty]

Cabcharge fees are not the same as surcharges for credit cards.

They are a fee charged by the service provider. This is how Cabcharge makes their profit.

CC fee surcharging is different; that is supposed to cover the cost to the vendor of the use of a credit card to provide the service.

Unfortunately, vendors are seeing the imposition of fees as a simple way of increasing revenue by charging more than the actual cost.

Technology is such these days that the exact cost to the vendor could be be calculated by the terminal at time of sale and charged to the purchaser - this is not what a vendor who is overcharging wants.

 

[LovemyCC]

We'll see in the long term whether surcharging cc will slowly increase with time. Starts off as a measly 1.5% but then slowly creeps up to 4%. I've seen Amex surcharge at 6%. I remember when visa/mc was 1% surcharge. But noticed with many suppliers/merchants that they are creeping to 1.5%. Even surcharges are not immune from inflation.

 

[serfty]

I noticed yesterday that JQ are charging a $7.50 per segment "convenience fee".:evil: That adds $15 to a R/T booking.

At least they don't have the gall to call it a CC surcharge.

 

[NM]

An interesting comparision for airfare credit card surcharges comes from our corporate travel centre. We are required to use our corporate Diners Club card for all flight bookings which must be made by the corporate travel centre (and in my experience they do a fantastic job). Each time I make a flight booking I receive three charges on my Diners Club card - one for the airfare as noted on the e-ticket receipt, one for the travel centre service charge ($145 for international, $99 for domestic made manually and $45 for domestic made via their web interface), and $2.20 that shows as a "Service Fee".

When I enquired about this $2.20 service fee I was informed its the credit card processing fee. Its a flat rate for each ticket issued. So on a $2200 ticket (about my average this year) that is 0.1% credit card surcharge for purchasing an airfare. I certainly cannot complain about that.

 

[dajop]

What gets me is the profit taking. Even if a merchant only passes on the exact fee they are profit taking, as other transaction methods are not without cost. If surcharging was fair and correct then paying cash should come with its own surcharge as IIRC the transaction cost are in decreasing order CC > Cash >> EFTPOS. And many charge in excess of what they are paying the CC provider. Of course for many smaller merchants, cash is much cheaper form of payment - as much easier to not declare it all to the ATO , and I'm sure why I've seen numerous local restaurants/take aways with ridiculously high surcharges for Visa/MC.

And as for the fees creeping into car hire, come on who are they kidding? CC is integral to their business, if not for ease of transactions and having some security over the vehicle, but also for recovering petrol, damage, tolls, fines etc ...

 

[ermen]

I tell you what is usurious... i booked a qantas YASA a few months ago - came up to A$280+ I think + 30k points. However, credit card fee was $30.
A 10%+ credit card fee on a A$280 payment???? That is PURE profiteering.

 

[JohnK]

Totally agree. Most hotels have it now and it is not uncommon to see 3%-5% surcharge for Amex.

There has already been a mooted Aff get together where we all check out at the same time from a hotel and pay in $5 notes. I think we need to revisit that as a subtle but effective protest.

Sounds like fun.

I can just see their frustration as they count $5 in silver coins, $10 in $1 coins, $10 in $2 coins, the remainder in $5 notes. And make sure you do not have enough and then start searching for loose coins in your pocket, bag etc. Can they really refuse to accept more coins if you do not have anymore money and no other means of paying for the stay?

I hate it when businesses push for a specific form of payment, have been pushing for many years, and then surcharge it....

 

[ColinP]

I tell you what is usurious... i booked a qantas YASA a few months ago - came up to A$280+ I think + 30k points. However, credit card fee was $30.
A 10%+ credit card fee on a A$280 payment???? That is PURE profiteering.

I can beat that.

I booked a JASA today. Chose to pay $150 to save a few points and was slugged $30 CC fee.:evil: 20% makes even Cabcharge look cheap .

 

[medhead]

Totally agree. Most hotels have it now and it is not uncommon to see 3%-5% surcharge for Amex.


Sounds like fun.

I can just see their frustration as they count $5 in silver coins, $10 in $1 coins, $10 in $2 coins, the remainder in $5 notes. And make sure you do not have enough and then start searching for loose coins in your pocket, bag etc. Can they really refuse to accept more coins if you do not have anymore money and no other means of paying for the stay?

I hate it when businesses push for a specific form of payment, have been pushing for many years, and then surcharge it....

The amounts I mentioned earlier are what google tells menus legal tender. So they could legally refuse to accept anything extra. So it would be interesting to see what they do if offered no other alternative. It fact it might be more interesting to see the response if one was $0.55 short and only had a credit card, with the demand of no surcharge.

The other thing that I've remembered is my mum had a boss once who insisted that stamps where legal tender, when paying petty cash claims. It would be even more interesting to offer to pay with $1 stamps.

Now when are we doing this?


Sent from my iPhone using Aust Freq Fly app so please excuse the lack of links.