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  • FIRST POST
    • MSE Megan F
    • By MSE Megan F 19th Jul 17, 8:27 AM
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    MSE Megan F
    MSE News: Government to ban ALL extra charges for paying by credit or debit card
    • #1
    • 19th Jul 17, 8:27 AM
    MSE News: Government to ban ALL extra charges for paying by credit or debit card 19th Jul 17 at 8:27 AM
    Companies will be banned from charging ANY fees for credit or debit card payments from early next year...
    Read the full story:
    'Government to ban ALL extra charges for paying by credit or debit card'

    Click reply below to discuss. If you havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.
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    • zerog
    • By zerog 5th Jan 18, 1:31 AM
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    zerog
    No need for the sarcastic nonsense.
    Originally posted by PeacefulWaters
    You started it with your silly quip about payment methods being better just because they are newer.


    I see both sides to the argument about choice. Sure, there might be a choice between paying by direct debit or paying more by card, or paying even more for a provider who doesn't give a direct debit discount.

    The optimist might say, if the total price including the credit card fee is still acceptable, and one wishes to pay by credit card, then why not just pay the fee and don't worry about whether direct debit is cheaper?

    On the other hand, if all the choices are poor then it could be said that you don't really have a choice. For example, as I find mayo disgusting, I don't have a choice if I need to buy a supermarket sandwich for lunch. Or to take things to extremes, a robber with a knife might give you the choice between giving him your valuables or being stabbed. By the logic of some posters, because the thief has a choice not to be a violent criminal, that means the victim also has a choice.
    • PeacefulWaters
    • By PeacefulWaters 5th Jan 18, 8:03 AM
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    PeacefulWaters
    You started it with your silly quip about payment methods being better just because they are newer.
    Originally posted by zerog
    Maybe I should have expressed my dislike of posting off cheques by explaining the cost of a stamp.
    • aj23
    • By aj23 5th Jan 18, 12:34 PM
    • 83 Posts
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    aj23
    You are struggling, and failing to see it. You have the choice to change mobile phone supplier; no-one is stopping you from doing so. However, you have chosen to stay with O2, despite not liking them, because you don't like the payment charges that other providers make. You have a choice of poor service with no payment charges or better service with payment charges and you've chosen the former option. That's your choice, and you're free to make that choice, but don't try and pretend that you don't have a choice, when you clearly do.
    Originally posted by EarthBoy
    I appreciate your willingness to tell me what I failing to see, but it's you is failing to see, hear, and everything else. I didn't saying anyone is stopping me from switching, you're misinterpreting and misconstruing. I can go with anyone I like on direct debit, my original point which you seem to have forgotten or not understood was that I shouldn't be threatened with a £5 non direct debit, such as a card payment, with whichever provider, which is what this thread was originally about, credit card fees.

    I am with 02 still because I still have nine months before I can leave them, and I have only had bad service in the past few months. Presently, I do not have a choice to switch, as I will have to pay the remaining nine months and also start a contract elsewhere, effectively paying double (or more) for the next months. Understand? Or do I need to simplify further.
    • EarthBoy
    • By EarthBoy 5th Jan 18, 12:58 PM
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    EarthBoy
    I am with 02 still because I still have nine months before I can leave them, and I have only had bad service in the past few months. Presently, I do not have a choice to switch, as I will have to pay the remaining nine months and also start a contract elsewhere, effectively paying double (or more) for the next months. Understand? Or do I need to simplify further.
    Originally posted by aj23
    I understand perfectly, but you never mentioned previously that you were still in contract with O2. You just said that you were prevented from switching because of the charge for payments other than direct debit:

    I am with o2. I'm not happy with them but because the other providers charge for non-direct debit payments it stops me from switching.
    Originally posted by aj23
    So it's not actually the charge for non direct debit payments that's stopping you switching after all. When your contract period is finished you'll have the choice to stay with O2 or change supplier.

    Whether or not they charge for non direct debit payments will be one of the factors that you take into account when making your choice. Such a charge isn't a threat, as you claim, it's just their particular business model. If you want their goods and services you will have to pay it; if you don't want to pay it, shop elsewhere.
    • eskbanker
    • By eskbanker 5th Jan 18, 1:01 PM
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    eskbanker
    I can go with anyone I like on direct debit, my original point which you seem to have forgotten or not understood was that I shouldn't be threatened with a £5 non direct debit, such as a card payment, with whichever provider, which is what this thread was originally about, credit card fees.
    Originally posted by aj23
    They are different issues though - as you say, this thread is specifically about the outlawing of card surcharges that comes into effect later this month, which means that merchants are no longer allowed to reclaim their processing costs from customers by surcharging for card payments.

    Differential pricing for payment by direct debit has been in place for many years, especially energy and utility companies, and this isn't changing with the introduction of these new regulations.

    The former has demonstrably led to recent loss of choice (HMRC, for example, will no longer accept personal credit card payments) but the latter is essentially continuing along the same path as it has for years.
    • aj23
    • By aj23 5th Jan 18, 1:13 PM
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    aj23
    I understand perfectly, but you never mentioned previously that you were still in contract with O2. You just said that you were prevented from switching because of the charge for payments other than direct debit:



    So it's not actually the charge for non direct debit payments that's stopping you switching after all. When your contract period is finished you'll have the choice to stay with O2 or change supplier.

    Whether or not they charge for non direct debit payments will be one of the factors that you take into account when making your choice. Such a charge isn't a threat, as you claim, it's just their particular business model. If you want their goods and services you will have to pay it; if you don't want to pay it, shop elsewhere.
    Originally posted by EarthBoy
    I said what is stopping me from, not that I am being stopped. I've said there are choices, not that I am not being given a choice at all.

    I know in September I have a choice to leave. I never said I didn't.

    It doesn't matter how I pay, I will still get the same service (or airtime plan). Them charging for what they deem inconvenient in terms of administration doesn't give me a better service. I fact I'd say it's a worse service charging for non direct debit payments, as it gives less choice to the customer as they feel they are forced into doing it how the provider wants to avoid being financially penalised.. Again, it doesn't cost Three £5 to administer a debit/credit card payment, a cheque, cash, or e-payment. It's about increasing profit.
    • aj23
    • By aj23 5th Jan 18, 1:15 PM
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    aj23
    They are different issues though - as you say, this thread is specifically about the outlawing of card surcharges that comes into effect later this month, which means that merchants are no longer allowed to reclaim their processing costs from customers by surcharging for card payments.

    Differential pricing for payment by direct debit has been in place for many years, especially energy and utility companies, and this isn't changing with the introduction of these new regulations.

    The former has demonstrably led to recent loss of choice (HMRC, for example, will no longer accept personal credit card payments) but the latter is essentially continuing along the same path as it has for years.
    Originally posted by eskbanker
    I know it isn't. My very first comment was asking if the Governments ban includes banning credit card fees for paying mobile phone bills.

    Providers never used to charge for payments. It's a relatively new money grabbing scheme.
    • eskbanker
    • By eskbanker 5th Jan 18, 6:58 PM
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    eskbanker
    Providers never used to charge for payments. It's a relatively new money grabbing scheme.
    Originally posted by aj23
    Well posters on here were complaining about it nine years ago so it's not really particularly new: http://forums.moneysavingexpert.com/showthread.php?t=1530947

    You won't be surprised to see that complaints alleging that such charges weren't reflective of costs incurred were also prevalent there too - in fact the last post on that 2009 thread pretty much sums up much of the above in terms suggesting it was already old news back then too:
    This has been argued sooo many times. You have a choice, if you dont want DD and dont want to pay more, dont use the company.
    The whole incentive vs fine thing (DD discount rather than nonDD charge) is also pretty pointless, it all boils down to the same thing.
    Originally posted by qw3rt7
    • aj23
    • By aj23 5th Jan 18, 8:04 PM
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    aj23
    Well posters on here were complaining about it nine years ago so it's not really particularly new: http://forums.moneysavingexpert.com/showthread.php?t=1530947

    You won't be surprised to see that complaints alleging that such charges weren't reflective of costs incurred were also prevalent there too - in fact the last post on that 2009 thread pretty much sums up much of the above in terms suggesting it was already old news back then too:
    Originally posted by eskbanker
    The problem is with your second quote is that as far as I know, o2 is the only provider who doesn't charge for non-direct debit payments. Every other mobile provider does charge.
    • eskbanker
    • By eskbanker 5th Jan 18, 8:51 PM
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    eskbanker
    The problem is with your second quote is that as far as I know, o2 is the only provider who doesn't charge for non-direct debit payments. Every other mobile provider does charge.
    Originally posted by aj23
    At the risk of going round in circles, I don't see why that's a problem with the quote.

    Most people I know would select their mobile provider based on a range of criteria, including total cost of ownership, handset offerings, tariffs available, geographical network coverage, access to local retail shops, ancillary perks, customer service, etc, etc, but if you elect to specify 'must have all payment methods at equal price' as your primary decision factor then frankly you're cutting off your nose to spite your face!
    • aj23
    • By aj23 6th Jan 18, 9:16 AM
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    aj23
    At the risk of going round in circles, I don't see why that's a problem with the quote.

    Most people I know would select their mobile provider based on a range of criteria, including total cost of ownership, handset offerings, tariffs available, geographical network coverage, access to local retail shops, ancillary perks, customer service, etc, etc, but if you elect to specify 'must have all payment methods at equal price' as your primary decision factor then frankly you're cutting off your nose to spite your face!
    Originally posted by eskbanker
    So do I. I am usually at home or work so am usually on on Wi-Fi, so I only have 500mb because I only average about 300mb. It's only £6. That's my criteria.

    But this isn't really the point I originally made or have been making. I'm just saying I want the flexibility of being able to be with any provider and not be financially penalised for choosing to pay how I want to pay for my custom which solely benefits them. Without customers, they don't exist. I don't see why direct debit is 'free' but if you make an online monthly card payment it increase your bill by £5 for, in my opinion, no good reason.

    As I've said many times, you being on direct debit benefits the provider only. If you are charged for something in error and don't realise or see it in time, they automatically take that money, and that's what I don't like about direct debit. Or like what happened to me, o2 didn't take the direct debit then threatened me with a late payment fee for their error.
    • eskbanker
    • By eskbanker 6th Jan 18, 12:23 PM
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    eskbanker
    I don't see why direct debit is 'free' but if you make an online monthly card payment it increase your bill by £5 for, in my opinion, no good reason.

    As I've said many times, you being on direct debit benefits the provider only.
    Originally posted by aj23
    ....which is why they offer customers a discount for choosing that method of payment, sharing the cost savings they make by using that rather than other means of paying.

    I can see that there's nothing anyone can say that'll convince you that it's cheaper for them to take payment by DD, and, as that 2009 poster said, the debate about whether it's a discount for DD or a surcharge for non-DD is as old as the hills too, but I suspect that this iteration of it has run its course too as it's also getting repetitive!

    For the record though, I'm certainly not defending companies that charge customers for errors they (the company) have made, which is clearly wrong, I'd move away from them if I were you
    • EarthBoy
    • By EarthBoy 6th Jan 18, 12:46 PM
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    EarthBoy
    I'm just saying I want the flexibility of being able to be with any provider and not be financially penalised for choosing to pay how I want to pay
    Originally posted by aj23
    It's pointless you repeating that because companies aren't going to give you that flexibility, so you've just got to suck it up, like it or lump it.

    As I've said many times, you being on direct debit benefits the provider only.
    Originally posted by aj23
    It also benefits you if it saves you £5 per month, or whatever the fee for non direct debit payment is.
    • aj23
    • By aj23 6th Jan 18, 4:52 PM
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    aj23
    ....which is why they offer customers a discount for choosing that method of payment, sharing the cost savings they make by using that rather than other means of paying.

    I can see that there's nothing anyone can say that'll convince you that it's cheaper for them to take payment by DD, and, as that 2009 poster said, the debate about whether it's a discount for DD or a surcharge for non-DD is as old as the hills too, but I suspect that this iteration of it has run its course too as it's also getting repetitive!

    For the record though, I'm certainly not defending companies that charge customers for errors they (the company) have made, which is clearly wrong, I'd move away from them if I were you
    Originally posted by eskbanker
    It doesn't save them any costs because it doesn't cost anything to make non-direct debit payments. It only costs the customers.

    You won't convince me. How can it cost Three £5 to administer a cash payment? Actual cash. It doesn't.
    • aj23
    • By aj23 6th Jan 18, 4:56 PM
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    aj23
    It's pointless you repeating that because companies aren't going to give you that flexibility, so you've just got to suck it up, like it or lump it.



    It also benefits you if it saves you £5 per month, or whatever the fee for non direct debit payment is.
    Originally posted by EarthBoy
    If people never expressed their dissatisfaction or discontent about anything then nothing would ever change. Why else is the government banning credit and debit card surcharges, because people don't like and it's not fair. It doesn't save me £5 to pay by direct debit because that's what I've always done anyway. I can make card payments online to o2 without being charged. Providers always used to give flexibility when they put people before profit. I'm all for making money but non-direct debit payments are rip off charges, no matter what you say.
    • eskbanker
    • By eskbanker 6th Jan 18, 6:09 PM
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    eskbanker
    It doesn't save them any costs because it doesn't cost anything to make non-direct debit payments. It only costs the customers.

    You won't convince me. How can it cost Three £5 to administer a cash payment? Actual cash. It doesn't.
    Originally posted by aj23
    As the discussion does seem to have become almost entirely circular, I'd simply refer you back to post #52 above, in which I listed some of the many costs a business incurs in processing payments, some of which will clearly vary according to the type of payment. Perhaps you're basing your simplistic and narrow views of payment processing costs on your apparently unrepresentative business that deals mostly in cheques, rather than appreciating the level of overheads involved in the billing and payment operations of large companies? Are you maybe believing that the only payment processing costs that proper businesses incur are bank charges?
    • aj23
    • By aj23 6th Jan 18, 7:11 PM
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    aj23
    As the discussion does seem to have become almost entirely circular, I'd simply refer you back to post #52 above, in which I listed some of the many costs a business incurs in processing payments, some of which will clearly vary according to the type of payment. Perhaps you're basing your simplistic and narrow views of payment processing costs on your apparently unrepresentative business that deals mostly in cheques, rather than appreciating the level of overheads involved in the billing and payment operations of large companies? Are you maybe believing that the only payment processing costs that proper businesses incur are bank charges?
    Originally posted by eskbanker
    Again I appreciate your trying to characterise me, but being rude really isn't necessary, required or welcome.

    If you can tell me why it costs Three for example £5 to process a cash payment so they charge the customer £5, please be my guest. I'd love to here it. Even if they do have bank charges, most are only 20p-50p, not £5, for certain deposit transactions.

    Once more, I appreciate you trying to tell me how our business is run and how, in your uninformed opinion, 'unrepresentative' it is. If is was so, then we wouldn't receive it as our largest method of payment, hence the few hundred customers on account clearly use them too. We are charged 2% of the value for every credit/debit card transaction, but we have never offset this or added it to our customers total. We absorb it the cost. Businesses, especially small to medium size, virtually run on cheques, and many sectors do.

    If Three has bank charges (though I doubt it) then they should be absorbed by their profits, not charging for something in order to avoid absorption and swell the profit. Bank charges should be included in their running costs, not offset to the customer. The clue is in their taglines: 'Direct debit is our preferred method of payment'.

    You seem more concerned with being insulting and uncourteous and you haven't really listened to what I'm saying so if you reply then fine but I won't be checking back.
    • eskbanker
    • By eskbanker 6th Jan 18, 8:04 PM
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    eskbanker
    if you reply then fine but I won't be checking back.
    Originally posted by aj23
    Bet you will!

    being rude really isn't necessary, required or welcome
    Originally posted by aj23
    ....or happening. At least not by me, I'm not the one posting intemperate ad hominem stuff like "What a stupid thing to say".

    I appreciate you trying to tell me how our business is run and how, in your uninformed opinion, 'unrepresentative' it is. [...] Businesses, especially small to medium size, virtually run on cheques, and many sectors do.
    Originally posted by aj23
    I'm not trying to be contentious or controversial but simply observing that a business where "75% of our credits and debits are done by cheque" is clearly not representative of businesses as a whole (given published figures about the continuing decline of cheque payments) and certainly not of the large mobile phone companies you're criticising.

    We are charged 2% of the value for every credit/debit card transaction, but we have never offset this or added it to our customers total. We absorb it the cost.
    Originally posted by aj23
    ....which is all very admirable but in turn confirms that it's clearly not free for a company to accept payment by a non-DD method.

    If Three has bank charges (though I doubt it) then they should be absorbed by their profits, not charging for something in order to avoid absorption and swell the profit. Bank charges should be included in their running costs, not offset to the customer.
    Originally posted by aj23
    Just to be clear I was meaning bank charges in the broad meaning, i.e. including merchant fees not just direct banking charges, but either way, you're just expressing a personal opinion about how you think absorbing costs is the right thing to do - that's not to say it's wrong but shouldn't be presented as fact.

    If you can tell me why it costs Three for example £5 to process a cash payment so they charge the customer £5, please be my guest. I'd love to here it.
    Originally posted by aj23
    I don't know the intimate details of their business overheads but have been trying to make the point that it's not just down to bank charges, there are all sorts of other costs, as per post #52. For example, there will large credit control departments employed to reconcile remittances against invoices and to chase non/late-payers, neither of which is necessary under the automated DD model. Bad debt provisions won't apply for DD payers but will for others, where collecting the payments isn't under the control of the company. However, I'm not saying that it's practical to reconcile an exact figure of £5 back to an individual non-DD bill payment but am just highlighting the absurdity of claiming that it doesn't cost anything.
    • cubz90
    • By cubz90 10th Jan 18, 10:20 AM
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    cubz90
    Will this cover ATM charges? The only ATM machines near me are in shops which charger £1.50 per withdrawal.
    • PeacefulWaters
    • By PeacefulWaters 10th Jan 18, 10:23 AM
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    PeacefulWaters
    Will this cover ATM charges? The only ATM machines near me are in shops which charger £1.50 per withdrawal.
    Originally posted by cubz90
    No.Dont be silly
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