Consumers have had to put up with a growing number of companies adding a surcharge of anything up to 3% for using a credit card – even when the banks charge the retailer much less than this and there is little or no alternative for the ripped-off consumer. (Banks charge the retailers around 0.8% for Visa and Mastercard and up to 2.1% for Amex or Diners Club)
Qantas and Virgin Australia charge amounts of around $7 as a “Card payment fee” which is revealed towards the end of a transaction as an addition to the advertised price and the consumer has little option but to pay it.
Hotels regularly charge up to 3.5% (name and shame: Art Series Hotels) or more surcharge for card payment no matter what card is being used. Again, the surprised consumer has no alternative unless they happen to be carrying hundreds of dollars in cash.
Others whose credit card surcharges will be closely examined in future include taxi companies – one of whom today charged us a whopping 10% (name and shame: GM Cabs in Melbourne), mobile phone suppliers, travel companies and restaurants.
Unfortunately, the saga is not over – the RBA has specified that the surcharges can be “the reasonable cost of card acceptance” but has not said what this is and the change is not effective until 1 January 2013.
Charging arbitrary fees to someone paying by card is a rort.
The “reasonable cost” is exactly what the retailer, airline or hotel is being charged by the credit card company.
Until 1 January, anyone charging you more than the above rates is rorting you.
We will report further on which companies continue to overcharge their customers.