Changes to card payment fees

[HeavyElectricity]

Just received the following email from Velocity:

Service message

On 1 September 2016, new government regulations relating to card payment fees will commence (Reserve Bank of Australia Card Payment Regulations). In line with these new regulations, Velocity will make certain changes to the fees charged for card payments.

Velocity currently charges a Booking and Service Fee for Reward Seat and Any Seat bookings. From 1 September 2016, Velocity will no longer be charging this Booking and Service Fee.

From 1 September 2016, a new Card Payment Fee will be charged for payments made via credit or debit card on the Velocity website. The Card Payment Fee will be published on our website and will also be displayed to Velocity Members during the booking process from 1 September 2016.

Yours sincerely,
Velocity Frequent Flyer

No mention as yet on what the new fee might be is a little disappointing - here's hoping it will be an improvement anyway.

 

[Pleb Status]

I would bet big money that the new VA surcharges will be within 0.1% of the new QF surcharges.

 

[Dannyism]

I just redeemed a flight. 170 in taxes. 30 service fee..... It will fix this at least.

 

[Homer]

No mention as yet on what the new fee might be is a little disappointing - here's hoping it will be an improvement anyway.

I would imagine it will be similar to QF's fee and work out cheaper than the current service fee for whY but more expensive than the current service fee for J.

 

[kpc]

Why couldn't VA wait till they worked out the cc fees before sending the e mail out with the new fees outlined?

 

[Princess Fiona]

Why couldn't VA wait till they worked out the cc fees before sending the e mail out with the new fees outlined?

I agree, it's a bit of a weirdly written email.

 

[JohnK]

Why couldn't VA wait till they worked out the cc fees before sending the e mail out with the new fees outlined?

The changes are only a month away and they still haven't worked out the fine details?

 

[Warks]

What everyone wants to know is: will it cost less? You'd think they'd trumpet that if it were on the agenda. Looks like they'll just rob Peter to pay Paul and switch the fees by changing the names.

 

[burmans]

What everyone wants to know is: will it cost less? You'd think they'd trumpet that if it were on the agenda. Looks like they'll just rob Peter to pay Paul and switch the fees by changing the names.

That would appear to be the most likely outcome, and the rationale will be that they were forced to do it.

 

[UP4014]

The cc fee department trying to make up for lost operational money..........

 

[777]

My understanding is that the new regulations mean that they can't charge more than the cost of service as a "credit card fee" so part of the reason it's vague is that it will probably be a % of ticket price based on the amount charged by the banks/ CC providers. Relying on dim memory of the rules as proposed there though.

 

[Aussie_flyer]

Why on earth send an email like that. We're changing our fees but we will keep them a secret for now. VA that is ridiculous

 

[RooFlyer]

Obviously going to be a nasty and they won't tell anyone until absolutely necessary

 

[Warks]

It's like the two different letters I get from the bank. If my repayments have gone down then they tell me "your repayments have decreased!" But if they go up then they say "your repayments have changed."

 

[Isochronous]

This is why increasing regulation is never a good idea.

 

[eastwest101]

I could have written that email for them - would have been along the lines of:

Service message

On 1 September 2016, new government regulations that the industry brought on itself relating to card payment fees will commence (Reserve Bank of Australia Card Payment Regulations). In line with these new regulations, Velocity will make certain changes to the fees charged for card payments. Our legal team have instructed us to notify you of these changes immediately but unfortunately the Virgin revenue management team have gone away to sulk, and don't talk to Velocity anyway so we can't tell you what the new fees will be.

Velocity currently charges a Booking and Service Fee for Reward Seat and Any Seat bookings. From 1 September 2016, Velocity will no longer be allowed to charge this Booking and Service Fee.

From 1 September 2016, a new Card Payment Fee will be charged for payments made via credit or debit card on the Velocity website. The Card Payment Fee will be published on our website once we examine what Qantas is doing and copy them / renegotiate with our credit card companies and once the the Virgin web site team have come back from their 4 year lunch break.

Yours sincerely,
Velocity Frequent Flyer

 

[777]

This is why increasing regulation is never a good idea.

Statements like this is why absolute ideologies are never a good idea.

Call me crazy but i'm quite happy to have a regulated air safety regime in this country.

In any case, i'm pretty sure the fees are going down as a result of the regulation. Most of the complaints i've seen are from the other side -- people who want fat point bonuses on their credit cards and are OK with these practices. Personally, I think companies shouldn't be allowed to complain a core part of their business is "service fee" so as to be able advertise prices that don't actually reflect what most people are able to pay for a product.

I'm with the Reserve Bank on this one: About Card Payments Regulation – Questions & Answers | RBA

 

[williamsf1]

not far from the truth eastwest101 .....

 

[serfty]

I can only think that some legal dude told them they need to give a months notice or something.

The email's seeming main purpose was to inform of a new fee and the retraction of another.

 

[JohnK]

What everyone wants to know is: will it cost less? You'd think they'd trumpet that if it were on the agenda. Looks like they'll just rob Peter to pay Paul and switch the fees by changing the names.

I think they are seriously trying to work out how to get more or at least the same as before.