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    • Beach Baby
    • By Beach Baby 30th Sep 16, 1:14 PM
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    Beach Baby
    0 WOW
    Credit Card Charges
    • #1
    • 30th Sep 16, 1:14 PM
    0 WOW
    Credit Card Charges 30th Sep 16 at 1:14 PM
    Why does my travel agent charge me a little over 2% to pay for my holiday when the percentage the banks charge them is considerably lower?
Page 1
    • Voyager2002
    • By Voyager2002 30th Sep 16, 3:35 PM
    • 11,015 Posts
    • 7,367 Thanks
    Voyager2002
    • #2
    • 30th Sep 16, 3:35 PM
    • #2
    • 30th Sep 16, 3:35 PM
    Because they can.
    • DomRavioli
    • By DomRavioli 30th Sep 16, 3:38 PM
    • 2,850 Posts
    • 4,755 Thanks
    DomRavioli
    • #3
    • 30th Sep 16, 3:38 PM
    • #3
    • 30th Sep 16, 3:38 PM
    Why does my travel agent charge me a little over 2% to pay for my holiday when the percentage the banks charge them is considerably lower?
    Originally posted by Beach Baby
    Because a CC charge doesn't only cover the merchant fee (which is what I'm guessing you're talking about). It covers any extra paperwork, and the risks associated with credit card purchases for sellers (section 75 usually). Its like a mini insurance policy bundled in with any associated administration, and the merchant fee.

    Plus again, they can charge what they like. There isn't a fee for cash.
    Observe, Adapt, Overcome.
    SPC 2015 #497
    • stephb34
    • By stephb34 30th Sep 16, 4:45 PM
    • 1,910 Posts
    • 873 Thanks
    stephb34
    • #4
    • 30th Sep 16, 4:45 PM
    • #4
    • 30th Sep 16, 4:45 PM
    I thought the travel agents have to pay the card provider more than 2% in fees but only ask for 2. You have other ways of paying that are free so you have a choice.
    • Moto2
    • By Moto2 30th Sep 16, 5:23 PM
    • 2,081 Posts
    • 1,798 Thanks
    Moto2
    • #5
    • 30th Sep 16, 5:23 PM
    • #5
    • 30th Sep 16, 5:23 PM
    I thought the travel agents have to pay the card provider more than 2% in fees but only ask for 2. You have other ways of paying that are free so you have a choice.
    Originally posted by stephb34
    The interchange fee is 0.3% (it used to be 0.8%)

    http://www.telegraph.co.uk/personal-banking/credit-cards/eu-ban-on-creditcard-fees-backfires--youll-still-pay25pc-to-spen/
    Change is inevitable, except from a vending machine.
    • shaun from Africa
    • By shaun from Africa 30th Sep 16, 5:47 PM
    • 8,687 Posts
    • 9,751 Thanks
    shaun from Africa
    • #6
    • 30th Sep 16, 5:47 PM
    • #6
    • 30th Sep 16, 5:47 PM
    Because a CC charge doesn't only cover the merchant fee (which is what I'm guessing you're talking about).It covers any extra paperwork, and the risks associated with credit card purchases for sellers (section 75 usually). Its like a mini insurance policy bundled in with any associated administration, and the merchant fee.

    Plus again, they can charge what they like
    . There isn't a fee for cash.
    Originally posted by DomRavioli


    No they can't.
    When accepting payment by credit cards, the retailer is legally only allowed to charge an amount that directly covers the extra costs incurred by them in accepting that payment.
    They are not allowed to make a profit from the fees nor can they may a charge to cover any risks such as S75 protection. (Apart from the fact that S75 risk is born by the credit card issuer and not the retailer).
    • savvy392
    • By savvy392 13th Oct 16, 5:21 PM
    • 1 Posts
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    savvy392
    • #7
    • 13th Oct 16, 5:21 PM
    • #7
    • 13th Oct 16, 5:21 PM
    I totally agree with Shaun.

    The Consumer Rights Regulations that came into force on April 6th 2013 state in Para. 4. (Excessive charges prohibited) the following;

    " A trader must not charge consumers in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of that means."

    UK Government guidance published in 2015 confirms that "...the cost...." Is the external cost to the trader and should not include any internal costs even if the trader employs persons to solely deal with credit card transactions.

    The Merchant Service Charge (MSC) is the only cost the trader should be able to add to a credit card transaction. As far as I understand, this is made up of two costs, the so called "interchange fee" charged by the likes of Visa and MasterCard plus the fee the trader pays his bank for handling credit charge transactions on his behalf.

    I have recently been charged 2.6% by a holiday company for payment of an upcoming holiday in advance. I intend to challenge this charge (and a similar charge on a payment to the same company a year ago). However there does not seem to be a way of discovering what the holiday company is charged in terms of MSC.

    My conclusion is that a law exists to protect the consumer but because the law does not place the onus on the trader to be transparent in terms of MSC, traders are able to charge pretty well what they like.
    The courts are open to the consumer as a source of redress. But very few cases have been brought to court since 2013. Hardly suprising when MSC's remain so opaque!
    • SailorGeoff
    • By SailorGeoff 2nd Dec 16, 5:29 AM
    • 1 Posts
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    SailorGeoff
    • #8
    • 2nd Dec 16, 5:29 AM
    Retailer imposed credit card charges
    • #8
    • 2nd Dec 16, 5:29 AM
    Interesting, I have just used a 0%on purchase credit card to pay the large element of a car purchase. The retailer hit me with a 2.75% fee for the balance over £2000. The cost of borrowing was greater than 2.75% so I am still ahead, but you get the feeling they are making on the personal decision to buy using a credit card. How do you get a retailer to be transparent?!
    • meer53
    • By meer53 2nd Dec 16, 8:55 AM
    • 8,360 Posts
    • 11,920 Thanks
    meer53
    • #9
    • 2nd Dec 16, 8:55 AM
    • #9
    • 2nd Dec 16, 8:55 AM
    Interesting, I have just used a 0%on purchase credit card to pay the large element of a car purchase. The retailer hit me with a 2.75% fee for the balance over £2000. The cost of borrowing was greater than 2.75% so I am still ahead, but you get the feeling they are making on the personal decision to buy using a credit card. How do you get a retailer to be transparent?!
    Originally posted by SailorGeoff
    They are being transparent, they tell you the charge before you buy. Your choice the use a credit card, not theirs.
    • martindow
    • By martindow 2nd Dec 16, 10:49 AM
    • 6,621 Posts
    • 3,587 Thanks
    martindow
    They are being transparent, they tell you the charge before you buy. Your choice the use a credit card, not theirs.
    Originally posted by meer53
    True but they need to comply with the regulations mentioned by savvy. It is difficult though as they can argue that their charge is not just the percentage fee charged by the card provider.

    Established companies with a reasonable turnover are likely to be paying far less than 2% but they are not going to tell you the exact figure.
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