End of internet shopping rip-off: Credit card fee for buying flights, holidays and goods is axed, sa

End of internet shopping rip-off: Credit card fee for buying flights, holidays and goods is axed, saving customers £300m Read more: www.dailymail.co.uk...

www.dailymail.co.uk

Excessive credit card charges for online shopping will be banned under laws to be unveiled today.

The hidden fees, which cost customers more than £300million a year, are imposed on flights, holidays and cinema and theatre tickets as well as by a range of other retailers.

At present, firms are not allowed to put surcharges on debit card payments. Under plans drawn up by Chancellor George Osborne, that ban will be extended to all cards.

Read more: www.dailymail.co.uk...

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Well dont start clapping about how much they care for you, but prepare yourself for a new type of card...well and internet card shopping style id. Yes this is the next step in hard core data mining.

Enjoy what remains of the so called free internet, not that i ever said it was free, well far from it, its so well structured and organized that everyone assumes its free.

www.dailymail.co.uk
(visit the link for the full news article)

reply to post by cerebralassassins

I like how the Ryanair boss has already said he won't comply. His BS reason? Administration costs to keep his website in the air and all the translation costs of having it in something like 11 languages. TO my mind those are business costs but companies and banks have been screwing people over for too long already using bad and just wrong arguments. It's a way of increasing profits pure and simple. From the dim recesses of my mind I think credit companies charged retailers 4% as a transaction cost but that was in "the old days".

Paypal charges both parties 4% (I believe) for a fully automated, no human hands needed "service". It's all a stinking, dirty rip-off and business is just dishonest and lying.

Meh ill be fine, I only ever travel by steam ship or hot air balloon as any good gentleman does when he tours the colonies.

Heres how it works:

As a online supplier, you get a merchant fee on credit charge, and not on a debit charge, a consumer should never have to pay a debit charge.
The merchant fee is passed on as these are generally large ticket items with minimal mark up from a wholesale purchase.

What the 'agent' does is get it at a cheaper rate for the consumer by bulk buying, its chepaer than you would get from a airline or hotel direct. If the item is say 2000 dollars nett, the agent generally puts a $25.00 - $50.00 booking fee, thats is the profit off what you buy, however the credit card companies charge the agent/merchant between 1.9%-4.1 % depending on is its amex or visa etc. That would put the selling agent who is getting the cheaper bulk purchased ticket for you into the red, thats why the merchant fee is passed on.
So either you pay the merchant fee on credit or prepare for items to get a bigger markup to cover the merhcant fee at sale time.

If they were to remove the credit fee by law, it would actually force the consumers to pay more by markups going from 25-50 dollars per purchase to about 250 mark up, in the end the current system allows you to purchase for cheaper if you pay cash or on debit.

And what most of you dont know is the airlines have a 'surcharge tax' since the 70s that is a merchant fee, so its nothing new, simply a cost that needs to be covered so one can use a credit facility.
I wouldnt bark too loudly unless one wants to see prices increase

reply to post by zazzafrazz

I would still counter your whole argument with "business cost" regardless of what the cost or or who is imposing it. As you have stated, those costs are known and could therefore be said to be quite logically, the cost of doing business. However, this is the real world of so-called cut-throat pricing and huge marketing divisions. Business is not honest. Why? Because they all want to make a nice catchy price tag for sheeple.

Example, an item should cost 38 dollars and 24 cents all-in. What will business do with that price? They'll make it 39.99, pocket the extra profit and have nice glitzy ads saying "less than 40 dollars". It's all a con. Until a business is prepared to be honest about costs, taxes, levies AND profit margins I think your argument is just wrong, whether that is morally, ethically or just on a human level I will leave that up to you but it is still just a nasty gimmick though.
ETA Holland has a temporary levy on car fuel. It's called "the quarter (25 cents) for Kok" (Wim Kok was the Prime Minister or some other government figure at the time, late 80's/early 90's I believe). They never quite got round to abolishing it after there was no need for it. Business and government stink and fill their own pockets at the expense of "ours".

reply to post by LightSpeedDriver


Well here is your choice.
Remove the middle man agent that creates competive pricing through preferrred relationships with suppliers by bulk buying, and then have airlines price collude to increse pricing expodentially for consumer direct purchasing, just as Qantas and British airways were fined millions for a few years ago when their middle man frieght agent went down.

or pay the merchant fee ( as you do in all purchasing since forever but you only have it disclosed by this indutstry and online recently) and keep pricing down.

Keep competition active, or pay more.


if the consumer is getting the line of credit, they should be the ones paying for it.

Add check the math on this. 4.1% of 2000 dollars is the merchant fee as a expample, ask to be charged the actual percentage fee not a flat fee.and it becomes cost neutral

reply to post by zazzafrazz

I believe your arguments again to be completely wrong. Where that line of credit is coming from,as long as it is not the retailer themselves should have no influence whatsoever on the price. A loan is usually charged at interest, no matter who the lender is.

By definition a middleman only increases prices. Unless you think they are doing it for free, that is.

Competition eventually ends up forming a cartel and keeping prices stable. History is full of it, to this day.

You do understand that preferred relationships are an exclusive (meaning to exclude others) thing, right?

4.1% on thousands of transactions is quite a tidy profit, no? Perhaps you work for a bank though...

reply to post by LightSpeedDriver


I dont work for a bank, but I understand these industries very very well.

Disagree with your stance on the middle man, as I believe in this inductry it has shown that when the middleman is out, the direct option creates price collusion, id rather stable, then price hikes.

4.1% is paid by the merchant to the credit card company it is not a profit.......why should they pay at a loss for someone being able to buy a ticket on credit?

Its cost neutral
The flat fee system is average of short haul and long haul merhcant fee averages, Id suggest you use a supplier that says you pay the the actual merchant fee amount, that way if you are buying a short haul you may only get a 10 dollar fee.

let me reiterate the 4.1% is not profit it is a fee that the merchant is charged for allowing a line of credit through the card supplier to be taken through the business.
You dont have to work in a bank to know this, rather any business owner understands the merchant fee premise is a high cost to your business.The merchant fee should be scrapped by the card company, not the merchant, If you make merchants pay and not pass it to the consumer, then just about every business will shut down......

reply to post by zazzafrazz

Let me re-iterate. The credit card company will earn money from the transaction at least once but regardless of that there is no credit on the side of the retailer. Transactions are immediate and automatic in this internet connected age. I have a credit card (but never use the credit part of it) and so also know of what I speak. No merchant or retailer in the world will ship goods or give services without first seeing that money in his bank account, or at the very least, a verifiable and legal guarantee for a debt to be fulfilled by some "agency". Should you know one though, please do be sure to let me know.

As for middle men I believe my point stands. Even with middle-men, pricing is fixed, as without them. From another angle, if I offer goods cheaper than my competitor, I will get the lion's share of the market and the rest will be forced to stop, or adjust prices. That you cannot deny. Don't believe me? Go to your local petrol stations, supermarket, energy suppliers and tell me how much difference you see in prices. The difference you see (should there actually be one) will be recouped on other items. In supermarkets this as known as loss-leading, Just to give a single example.

Here it is illegal (probably/possibly the same elsewhere) for consumers to buy direct from a wholesaler. A governmental measure to increase profits and revenue.