MSE News: Monarch hits flyers with credit card fee hike

Former_MSE_Helen

This is the discussion thread for the following MSE News Story:

"Monarch's new charges mean the majority of its passengers will pay even more for the privilege of paying"

Read the full story:
Monarch hits flyers with credit card fee hike

richardw

Debit cards and PayPal are still gratis, unlike easyJet.

aldredd

A Monarch spokeswoman says: "The move to switch to a percentage fee rather than a fixed credit fee will benefit many Monarch passengers as the minimum fee is significantly less than the previous fixed fee applied to all credit card bookings."

What do these companies take us for?!

NFH

2sides2everystory wrote: »

Does anyone know if, for example, Consumer Credit Act 1974 Section 75 protection is still effective if you use your credit card to pay for flights indirectly via PayPal?

This is unclear. The Consumers' Association say that it does apply for various reasons, but I recently referred a case to the Financial Ombudsman who ajudicated that it did not apply. In practice it will not apply until someone brings a test case in court.

chattychappy

Yep, all my reading suggests it doesn't apply though I don't think it's been tested, as you say.

Personally I'm fine with airlines doing this kind of thing provided it's clear at the point of commitment. If consumers don't like it they can go elsewhere/pay more etc.

Anyway, seems Which? and co. are intervening in an increasingly busy-body way, so step by step these practices will be eliminated.

What I object to is all the tax that is taken on flight tickets.

Louisdf

2sides2everystory wrote: »

So you can pay for Monarch flights using PayPal? Didn't know that.

And you can link your PayPal account to your credit card and thereby avoid the charges I presume?

Does anyone know if, for example, Consumer Credit Act 1974 Section 75 protection is still effective if you use your credit card to pay for flights indirectly via PayPal?

I presume so, so is there any catch in using PayPal this way?

Is it really essential to pay by credit card for a Monarch flight? They seem unlikely to go bust, as they have added several new routes from Manchester and Birmingham this year to Milan/Venice/Verona.

spanglish

2sides2everystory wrote: »

And you can link your PayPal account to your credit card and thereby avoid the charges I presume?

You'll need to check the terms of your credit card. I've recently had a letter from Barclaycard to say that these transactions will now be treated as cash advances with all the associated costs, which may be higher than Monarch's own fees.

luci

2sides2everystory wrote: »

So you can pay for Monarch flights using PayPal? Didn't know that.

And you can link your PayPal account to your credit card and thereby avoid the charges I presume?

Does anyone know if, for example, Consumer Credit Act 1974 Section 75 protection is still effective if you use your credit card to pay for flights indirectly via PayPal?

I presume so, so is there any catch in using PayPal this way?

No, Section 75 won't apply if you pay by Paypal. There needs to be a direct association with the company you are booking with. As you are paying Paypal and they are paying Monarch then a third party is involved and it's not a direct association.

NFH

luci wrote: »

No, Section 75 won't apply if you pay by Paypal. There needs to be a direct association with the company you are booking with. As you are paying Paypal and they are paying Monarch then a third party is involved and it's not a direct association.

There is rarely a direct association in any credit card purchase transaction. When making a purchase by credit card, it is impossible to purchase directly from a supplier (merchant) because multiple parties are nearly always required between the card issuer and the merchant. Credit card transactions are conventionally processed by the following chain of parties where the arrows show payment of money:

[Card Holder] -> [Card Issuer] -> [Card Network] -> [Acquirer] -> [Merchant]

Typical examples of card networks include Visa, MasterCard, American Express and Diners Club.
Typical examples of acquirers include Streamline, Lloyds TSB Cardnet, Sage Pay and PayPal.

In some cases, the same organisation may act as card issuer, card network and/or acquirer, but this is more the exception than the rule. It is widely accepted that Section 75 applies when all five of the above parties are different entities.

luci

One example of direct v third party.

If you go on an airline's website, book flights and pay by credit card it would be a direct association.

If you went into the local travel agent, booked flights and paid them by credit card there would be a third party involved. If the airline went bust you couldn't claim against the travel agent as they will have done what you contracted them to do which is provide flight tickets. You have no claim against the airline as there is no direct association. The fact that you couldn't use the tickets is irrelevant as your contract is not with the airline.

NFH

luci wrote: »

If you go on an airline's website, book flights and pay by credit card it would be a direct association.

Yes, perhaps. However, this doesn't prove that PayPal isn't an acquirer in such a transaction, just like Streamline, Lloyds TSB Cardnet, Sage Pay etc.