Charges for credit card purchases?

MrHarrison_2

When making certain purchases online, some companies charge a credit card fee.
Paying for a recent holiday incurred a 2.5% charge - so about 70 pounds on top of the price if you didn't use a debit card.
Of course, these additional fees don't apply on all purchases.
So is this simple profiteering?
And what can I do to avoid making these payments?

[Deleted User]

Use a debit card.

Jigga

An excellent insight into this area here: https://forums.moneysavingexpert.com/discussion/3048524

From my experience, I assume that those who levy % charges for paying by card do so because they are in a very competitive market where margins are slim and the card charges would eat up any profit, such as airlines, holiday companies etc. All local independent IT shops that I have bought from charge card fees on top, but they are cheaper prices than say PC World who will have set their prices to mitigate against card fees (amongst all of the other additional overheads they will have).

Paul_Herring

MrHarrison wrote: »

Of course, these additional fees don't apply on all purchases.

They apply to all credit card purchases, even down the supermarket, since it costs the company money (usually a percentage of the total, with a minimum) to process.

Companies either spread their charge by
1) increasing prices to everyone who makes a purchase (e.g. supermarkets), or
2) increasing the price to just those using cards (e.g. holiday firms, car dealerships.)

So is this simple profiteering?

Depends on the differential between the charge made to the company you're using and the charge they pass on to you. 2% isn't unusual.

And what can I do to avoid making these payments?

Don't use credit cards for purchases. Not a wise idea for some things however.

whatyadoinsucka

ryanair is a simple profiteerer when it comes to card charges,
having seen the rates a top 4 supermarket pay per month, i can imagine how much more a smaller company would pay with far fewer transactions

credit cards are a fixed fee plus % Fee, whereas debit card are mainly a fixed fee (like 50p-£2 in the £100)
even paying money into a business account costs £1 per £100 these days

look around when you book things, a debit card is always best for holidays, although less protection than a credit card

jonesMUFCforever

If you buy something costing more than £100 just £1 on the credit card (the rest on a debit card) would be sufficent to make the credit card lender jointly liable for the total amount of the transaction under the CCA.