Singapore air booking surcharge

[wxxnxs]

Surprised! Singapore airline starts charging credit card processing fee for $25 from Apr 2009, just realized that, because that fee has been include in the total price already. It only applys if you travel from Australia. Lucky, the cathay paicific has not done so. I still couldn't understand why only Australia can allow so many companys to do surcharge:?:

 

[thewinchester]

Re: Signapore air booking surcharge

Surprised! Singapore airline starts charging credit card processing fee for $25 from Apr 2009, just realized that, because that fee has been include in the total price already. It only applys if you travel from Australia. Lucky, the cathay paicific has not done so. I still couldn't understand why only Australia can allow so many companys to do surcharge:?:

Simple, because we had a backward-cough Governor of the Reserve Bank who thought deregulation of the payment interchange markets for electronic transactions would bring about greater transparency, competition and reductions in costs and charges passed onto the consumer.

Apologise, but a quick history lesson and rant is in order here. Stop me if this goes too long or I manage to put you to sleep.

Like most people who believed in the application of free-market economic theory to the costs of doing business, Glen Steven's plans failed completely. As a result, we now have ATM's that charge an average of at least $2 per transaction with no sign of reductions and operators gouging consumers even more - and obviously making more as a result.

An example of how bad the gouging was: Everyone's favourite NAB day-to-day account, the Gold eBanking account used to provide totally fee free banking regardless of who's ATM's you use. Fast forward to September this year, where the direct charging regime made this no longer economical for the bank to do - and simply removed that feature and shifted the cost onto the consumer.

Banks have tried to offset this problem by going back to consolidating their ATM infrastructure and networks (Such as the NAB/Rediteller deal), but this still leaves consumers of some banks stuck using foreign ATM's due to their location and the convenience of not having to constantly carry huge amounts of cash (the whole central point of electronic funds transfer networks, particularly since the costs of handing physical cash in large volumes still can be a significant overhead in a business).

The thinking of Ayn Rand (fostered and propagated primarily in recent history by Rand disciple, former US Fed Chairman Alan Greenspan) is great in some parts of the free market economy, but on this one Australia has screwed the pooch. Consumers are picking up the tab for what is essentially financial greed by the Four Pillocks (actually the Four Pillars, but rather use the name for them from the financial industry) and their smaller cohorts.

And here's the odd paradox to all of this, go back to the late 80's and early 90's when ATM's were in full swing, the days of dot matrix receipt printers on little square pieces of card - or in the case of Citibank ATM's huge slips of paper the size of cheques. There were two linked ATM networks, Commonwealth & Westpac, then NAB, ANZ and the Credit Unions.

In the mid 90's we had the partial consolidation of the banking industry when Westpac bought up Challenge Bank followed by Bank of Melbourne. Once Challenge had been acquired - this broke the barrier between the two networks and everything operated harmoniously... until the banks realised we could make a profit off these guys.

Thankfully the regulation in place capped these interchange fees, and the costs were nominal and banks didn't pass them on until fee structures based on numbers of transactions became commonplace towards the end of the decade and shifting into the new millennium.

Ideally, all it would take is one major bank to say 'Hey, it doesn't cost us $2 to process a transaction - why not make it cheaper, encouraging more and more people to make electronic transactions and making up the difference with this increased transaction volume'.

Suddenly, the intended common sense free market principals come into place, spurning competition between everyone achieving the desired outcome of the changes in the first place - benefits to consumers through reduced costs of doing business.

The problem - none of the Four Pillocks or their cohorts have been brave enough to take that step, and until someone does we're basically stuck paying through the nose for something we need, should have access to, and doesn't cost anywhere near what we're being charged for it in the first place.

Geez, this sounds worse than my venting about annoying uncontrolled offspring in airline lounges.

 

[Hvr]

Re: Signapore air booking surcharge

Ideally, all it would take is one major bank to say 'Hey, it doesn't cost us $2 to process a transaction - why not make it cheaper, encouraging more and more people to make electronic transactions and making up the difference with this increased transaction volume'...

A bank acting ethically? Wow I doubt I will ever see it. The only think they will do is see how much the market (i.e. the customers) will tolerate before they announce a 'fee freeze' for 6-12 months and then raise the fees on other products to cover 'lost' revenue.

The problem - none of the Four Pillocks or their cohorts have been brave enough to take that step, and until someone does we're basically stuck paying through the nose for something we need, should have access to, and doesn't cost anywhere near what we're being charged for it in the first place.

Geez, this sounds worse than my venting about annoying uncontrolled offspring in airline lounges.

Why would they 'be brave'? There is enough money to be gouged from customers for everyone. As long as we can actually get access to our money within a reasonable period when required then I reckon very few customers will do anything. This poster included I am sad to say.

 

[serfty]

I'm sure the deals that W/Pac have with Citybank and Wizard for no-ATM fee withdrawals cost the card providers much less than that $2.

 

[Travel Guru]

Re: Signapore air booking surcharge

I have no issues with merchants being able to pass on the credit card surcharges incurred so long as theyre reasonable.

I don't really see any issue with SQ charging $25, realistically if the fare is 2k, a 1.1% surcharge is going to cost SQ $22, so $25 appears acceptable.

Consumers seem to want to have their cake and eat it too, they want to be able to acrue frequent flyer points and not incur any surcharges for using their cards, but when a merchant is working on margins of 4-10% depending on airline etc, why should they have to incur it just so you can have your FFP's?

TG

 

[oz_mark]

Re: Signapore air booking surcharge

An example of how bad the gouging was: Everyone's favourite NAB day-to-day account, the Gold eBanking account used to provide totally fee free banking regardless of who's ATM's you use. Fast forward to September this year, where the direct charging regime made this no longer economical for the bank to do - and simply removed that feature and shifted the cost onto the consumer.

Banks have tried to offset this problem by going back to consolidating their ATM infrastructure and networks (Such as the NAB/Rediteller deal), but this still leaves consumers of some banks stuck using foreign ATM's due to their location and the convenience of not having to constantly carry huge amounts of cash (the whole central point of electronic funds transfer networks, particularly since the costs of handing physical cash in large volumes still can be a significant overhead in a business).

There are options if you are willing to look outside the big four (really these days it is more like 2 pillars and 2 stumps). For example ING Orange Everyday allows withdrawals over $200 from any ATM and ING cover the cost of the operator fee. Granted such accounts may not suit everyone, but there are options.

 

[anat0l]

Re: Signapore air booking surcharge

I have no issues with merchants being able to pass on the credit card surcharges incurred so long as theyre reasonable.

I don't really see any issue with SQ charging $25, realistically if the fare is 2k, a 1.1% surcharge is going to cost SQ $22, so $25 appears acceptable.

Consumers seem to want to have their cake and eat it too, they want to be able to acrue frequent flyer points and not incur any surcharges for using their cards, but when a merchant is working on margins of 4-10% depending on airline etc, why should they have to incur it just so you can have your FFP's?

Well, considering QF just got given Choice's Shonky Charge of the Year (or decade?) Award, obviously there are a sizeable number (or loud enough people) out there who believe that they deserve it.

Remember that most consumers don't care whether the merchant is making any money or not.

The fixed $25 charge is OK in your example, but given say a simple $800 sale return fare in Y from East Coast Australia to SIN, the charge now represents 3% of the cost.

QF just looks bad; although Trans-Tasman is charged at $7.70 (like domestic), something like Fiji with fares of $400 r/t means that a booking fee of $25 is 6%. Mind you, charging $7.70 for a, say, BNE-SYD r/t at about $160 during a sale is just under 5% surcharging.

In any case, I can't see the surcharge on SQ; i.e. if I bring up the itimised list of charges and taxes, I can't see anything which looks like a SQ booking fee or similar. If you mean that the fare from AU to SIN is more expensive than SIN to AU, well, that's natural (almost every airline has the same trend, and that's not just SIN).

 

[Travel Guru]

Re: Signapore air booking surcharge

The fixed $25 charge is OK in your example, but given say a simple $800 sale return fare in Y from East Coast Australia to SIN, the charge now represents 3% of the cost.

True, but just remember that in my example where it worked out to just over 1%, they'd then be losing money on the surcharge when someone pays amex or dc, so it would all average out, and while it not fair that someone paying visa should wear the equivalent of 3%, thats life i guess.

TG

 

[dajop]

Re: Signapore air booking surcharge

True, but just remember that in my example where it worked out to just over 1%, they'd then be losing money on the surcharge when someone pays amex or dc, so it would all average out, and while it not fair that someone paying visa should wear the equivalent of 3%, thats life i guess.

TG

I think you're probably spot on from a travel agent perspective (well you should be!!).

For solely airline distributed product (such as airline website) - SQ's fee is set to align with QF's. QF I am sure set their fee to make money. OK they will tell us the credit card fees cost more than the recoup in surcharge - but for the higher J class fares, where they don't come close te getting back the merchant fees with the surcharge I betthey factor this into fare pricing anyway.

 

[JohnK]

Re: Signapore air booking surcharge

Simple, because we had a backward-cough Governor of the Reserve Bank who thought deregulation of the payment interchange markets for electronic transactions would bring about greater transparency, competition and reductions in costs and charges passed onto the consumer.

I have noticed a sign in a newsagency in Sydney that charges a fee for EFTPOS from debit cards. Yes debit cards not credit cards. They do not accept credit cards and there is a sign along the lines of "There is a fee of 40 cents for every EFTPOS transaction from a debit card".

Is this the sign of things to come? We want a cashless society but then charge everybody a fee for using the only accepted form of payment. There is something just not quite right here....

 

[Travel Guru]

Re: Signapore air booking surcharge

I have noticed a sign in a newsagency in Sydney that charges a fee for EFTPOS from debit cards. Yes debit cards not credit cards. They do not accept credit cards and there is a sign along the lines of "There is a fee of 40 cents for every EFTPOS transaction from a debit card".

Is this the sign of things to come? We want a cashless society but then charge everybody a fee for using the only accepted form of payment. There is something just not quite right here....

I dare say for small transactions its a sign on things to come.

Debit Cards tend to attract a fixed surcharge from the card providers to the merchants as opposed to credit which is a percentage, so you can understand merchants of products such as a newsagents wanting to recoup them.

TG

 

[oz_mark]

Re: Signapore air booking surcharge

I have noticed a sign in a newsagency in Sydney that charges a fee for EFTPOS from debit cards. Yes debit cards not credit cards. They do not accept credit cards and there is a sign along the lines of "There is a fee of 40 cents for every EFTPOS transaction from a debit card".

I saw something along the same lines at a restaurant recently, so dare say it will be something that will spread more widely.

 

[thewinchester]

Re: Signapore air booking surcharge

I have noticed a sign in a newsagency in Sydney that charges a fee for EFTPOS from debit cards. Yes debit cards not credit cards. They do not accept credit cards and there is a sign along the lines of "There is a fee of 40 cents for every EFTPOS transaction from a debit card".

Is this the sign of things to come? We want a cashless society but then charge everybody a fee for using the only accepted form of payment. There is something just not quite right here....

I saw something along the same lines at a restaurant recently, so dare say it will be something that will spread more widely.

This will only become the status quo if consumers accept it. If you feel a merchant is charging unfair fees for the use of a service, go elsewhere - vote with your feet.

My opinion, based on a number of years in the retail and service game (including two years working solely on electronic payment systems with $10m+/yr turnover) is that business are trying to put their costs for working with you on your shoulders - which is out and out wrong.

I dare say for small transactions its a sign on things to come.

Debit Cards tend to attract a fixed surcharge from the card providers to the merchants as opposed to credit which is a percentage, so you can understand merchants of products such as a newsagents wanting to recoup them.

I have no issues with merchants being able to pass on the credit card surcharges incurred so long as theyre reasonable.

I don't really see any issue with SQ charging $25, realistically if the fare is 2k, a 1.1% surcharge is going to cost SQ $22, so $25 appears acceptable.

Consumers seem to want to have their cake and eat it too, they want to be able to acrue frequent flyer points and not incur any surcharges for using their cards, but when a merchant is working on margins of 4-10% depending on airline etc, why should they have to incur it just so you can have your FFP's?

Sorry, but I don't buy either of these points for a millisecond. Passing merchant fees onto your customer isn't reasonable at all - its the cost of your doing business with them and should be built into your pricing model.

Anyone with a clue understands that there are certain costs involved with acquiring customers, from marketing, advertising, fittings and fixtures, etc.

The same goes for payment infrastructure regardless of the medium used. Cheques have to be processed, reconciled and banked. Cash has to be counted, secured and also banked. Electronic payment systems require a little bit of hardware, some software and some small ongoing fees.

Do you really think a supermarket cashier is going to say to you 'I'm sorry, but we now charge 15c per transaction for cash payments'. Why you ask, because that's your share of our costs for handling the cash you give us for your shopping to put it into our bank account and do what you pay us to do.

Nope, I don't think anyone would or should swallow that tripe for a second - and electronic payments should be no different from cash.

Electronic payment systems are actually a godsend for most companies, as the process of managing payments is highly automated and is hands-off for most, if not all of the process.

These systems deliver companies a greatly reduced cost of doing business, through a reduction in labour, data entry, security infrastructure, and physical assets. It also reduces the risk of handling negotiable payments, both in terms of theft/armed robbery and arising insurance premiums, but the fact the proceeds of electronic payments can be traded upon as assets almost immediately.

In the case of larger merchants such as airlines and retail empires (Woolworths, Westfarmers et al) the transaction volumes they process allow them to negotiate rates which are so far below market it's almost nothing.

Most medium to large implementations pay for themselves within weeks of being implemented. The audacity of these organisations to keep charging for something which in reality is a profit gouge is at best unconscionable, and worst greedy and bad business practice.

Simply charging a fee on top is just darned lazy and off-putting, and it gives me the impression both your business and your skills aren't worth the cardboard from wheaties packet they came printed on.

So what can you do about it?

If your a customer: walk away from businesses who charge you additional fees for using a card - and tell those business why. The more customers who do it and walk away, they quicker they learn.

If you run a business: negotiate down your fees - and ensure those savings are passed onto your customers.

I've helped businesses doing barely over AUD2k/mth in volume get their charges reduced by a couple of percentage points by simply saying they've had enough and will take their business elsewhere. Most of them don't do it, because they don't know they can.

If your bank isn't going to budge, then make good on your threat and walk across the road to someone else.

One of the only advantages arising from the payment interchange markets shake-up was the entry of non-bank processors into the market, Tyro being one example. I have no relationship with Tyro, but I know enough about them to give them my unqualified recommendation. They have the best non-bank equipment out there, their service is known to be unparalleled, and the level of features and direct system integration with their platform is unmatched anywhere in the payments industry.

The good thing about them is one of their key platforms of business is to keep driving down the cost of their service and transparency, not just every 12mths but right away as the cost of service comes down.

As more and more business look for alternatives for electronic payments, and particularly move to non-bank providers such as Tyro, this will force the competition in the market the policy was meant to deliver.

 

[kpc]

Re: Signapore air booking surcharge

In any case, I can't see the surcharge on SQ; i.e. if I bring up the itimised list of charges and taxes, I can't see anything which looks like a SQ booking fee or similar.

I too had trouble finding the $25 credit card surcharge, until pointed out to me on SQ Talk.

Check more closesly in surcharges, for example:

Carrier Surcharges include the following:

Airline Fuel and Insurance Surcharge(YR) AUD 25.00
Airline Insurance(YQAD) AUD 24.40
Airline Fuel Surcharge(YQAC) AUD 235.80

Total Carrier Surcharges AUD 285.20


The bold is the CC surcharge I believe. Nicely disguised as something else

SQTalk - View Single Post - SQ to charge credit card fee

 

[Travel Guru]

Re: Signapore air booking surcharge

This will only become the status quo if consumers accept it. If you feel a merchant is charging unfair fees for the use of a service, go elsewhere - vote with your feet.

My opinion, based on a number of years in the retail and service game (including two years working solely on electronic payment systems with $10m+/yr turnover) is that business are trying to put their costs for working with you on your shoulders - which is out and out wrong.





Sorry, but I don't buy either of these points for a millisecond. Passing merchant fees onto your customer isn't reasonable at all - its the cost of your doing business with them and should be built into your pricing model.

Anyone with a clue understands that there are certain costs involved with acquiring customers, from marketing, advertising, fittings and fixtures, etc.

The same goes for payment infrastructure regardless of the medium used. Cheques have to be processed, reconciled and banked. Cash has to be counted, secured and also banked. Electronic payment systems require a little bit of hardware, some software and some small ongoing fees.

Do you really think a supermarket cashier is going to say to you 'I'm sorry, but we now charge 15c per transaction for cash payments'. Why you ask, because that's your share of our costs for handling the cash you give us for your shopping to put it into our bank account and do what you pay us to do.

Nope, I don't think anyone would or should swallow that tripe for a second - and electronic payments should be no different from cash.

Electronic payment systems are actually a godsend for most companies, as the process of managing payments is highly automated and is hands-off for most, if not all of the process.

These systems deliver companies a greatly reduced cost of doing business, through a reduction in labour, data entry, security infrastructure, and physical assets. It also reduces the risk of handling negotiable payments, both in terms of theft/armed robbery and arising insurance premiums, but the fact the proceeds of electronic payments can be traded upon as assets almost immediately.

In the case of larger merchants such as airlines and retail empires (Woolworths, Westfarmers et al) the transaction volumes they process allow them to negotiate rates which are so far below market it's almost nothing.

Most medium to large implementations pay for themselves within weeks of being implemented. The audacity of these organisations to keep charging for something which in reality is a profit gouge is at best unconscionable, and worst greedy and bad business practice.

Simply charging a fee on top is just darned lazy and off-putting, and it gives me the impression both your business and your skills aren't worth the cardboard from wheaties packet they came printed on.

So what can you do about it?

If your a customer: walk away from businesses who charge you additional fees for using a card - and tell those business why. The more customers who do it and walk away, they quicker they learn.

If you run a business: negotiate down your fees - and ensure those savings are passed onto your customers.

I've helped businesses doing barely over AUD2k/mth in volume get their charges reduced by a couple of percentage points by simply saying they've had enough and will take their business elsewhere. Most of them don't do it, because they don't know they can.

If your bank isn't going to budge, then make good on your threat and walk across the road to someone else.

One of the only advantages arising from the payment interchange markets shake-up was the entry of non-bank processors into the market, Tyro being one example. I have no relationship with Tyro, but I know enough about them to give them my unqualified recommendation. They have the best non-bank equipment out there, their service is known to be unparalleled, and the level of features and direct system integration with their platform is unmatched anywhere in the payments industry.

The good thing about them is one of their key platforms of business is to keep driving down the cost of their service and transparency, not just every 12mths but right away as the cost of service comes down.

As more and more business look for alternatives for electronic payments, and particularly move to non-bank providers such as Tyro, this will force the competition in the market the policy was meant to deliver.

Hmm..I would respond to what you've said but clearly I don't have a clue about business (despite running my own very successful one!)

TG

 

[JohnK]

Re: Signapore air booking surcharge

I too had trouble finding the $25 credit card surcharge, until pointed out to me on SQ Talk.

That is sneaky and totally dishonest.

Airline Fuel and Insurance Surcharge? What the....

 

[thewinchester]

Re: Signapore air booking surcharge

Hmm..I would respond to what you've said but clearly I don't have a clue about business (despite running my own very successful one!)

Yeah, might have been a little disingenuous there. I'll sit in the corner now.

 

[Alanslegal]

Re: Signapore air booking surcharge

That is sneaky and totally dishonest.

Airline Fuel and Insurance Surcharge? What the....

I'm going to jump in here and say well done to SQ for putting an ALL INCLUSIVE fare even if it appears they are maybe disguising something for something else eg. the cc surcharge.

(I know this is a tiny sample) but I made two bookings on SQ.com late last year and on their website, they will show you the total cost of the itinerary WAY BEFORE you proceed to booking confirmation page. So even if there is a surcharge, at least SQ has already priced into the pricing, and this is the way it is suppose to be!!

 

[anat0l]

Re: Signapore air booking surcharge

I'm going to jump in here and say well done to SQ for putting an ALL INCLUSIVE fare even if it appears they are maybe disguising something for something else eg. the cc surcharge.

(I know this is a tiny sample) but I made two bookings on SQ.com late last year and on their website, they will show you the total cost of the itinerary WAY BEFORE you proceed to booking confirmation page. So even if there is a surcharge, at least SQ has already priced into the pricing, and this is the way it is suppose to be!!

Fair enough, but they could do with a better title for the charge. Unless the charge is earnestly meant to cover something other than the credit card processing fees.

 

[zzyss]

Re: Signapore air booking surcharge

Fair enough, but they could do with a better title for the charge. Unless the charge is earnestly meant to cover something other than the credit card processing fees.

Maybe the insurance is for SQ against losses from fuel prices, not insurance for pax Kinda like how you have to pay for Mortgage Insurance to protect the bank when taking out a loan