Credit price for goods more than cash price

buff-tom

Hi thanks for reading, I was doing a small business course a few years ago and was told on it if you offer goods for sale you cannot charge more for it if it is sold on credit than the cash price you are offering it for sale at i.e

If you are selling a TV for a cash price of £100 or

if you want it on credit it would be £120 plus interest on top of the £120 is this right?

Tom

cardinalbiggles

I think you can charge what you like providing its not advertised as 0% credit, that would be the illegal bit. In that case a retailer can't discount as it is no longer 0%.

Money-Saving-King

It would be odd but I don't see the problem if all the costs are upfront.

Why did you ask, is there an example you can post?

Collabora

The only thing i would say is if the company is offering credit on its own back then it must have a Consumer Credit licence

halibut2209

Am I missing something here? Car insurance companies do this all the time. Cheaper to pay in full up front than to pay using credit

Money-Saving-King

halibut2209 wrote: »

Am I missing something here? Car insurance companies do this all the time. Cheaper to pay in full up front than to pay using credit

I took it the op means that an item is discounted but they want payment as physical cash only.

bris

There are costs involved in offering credit, these can be passed to the customer, just like credit cards.


But as said above they can not call it interest free credit. If you go into one of the big interest free furniture retailers for instance and ask for a discount for cash they are not allowed to do it, I know I tried and the salesman told me it was illegal.

Dr._Shoe

Am I missing something here? Car insurance companies do this all the time. Cheaper to pay in full up front than to pay using credit

That's because you sign a credit agreement with a company like Prompt Pemium Finance and they charge you interest. It isn't the insurance company that charges you extra.

The OP asked if it was legal to charge extra and then interest on top.

Broadly speaking, this amounts to an "admin charge" which is illegal, They can ask for reimbursement of the extra costs of processing a credit card payment but AFAIK they cannot charge extra for credit other than interest. They can however offer a discount for cash.

bod1467

Maybe I'm misreading the OP, but there are plenty of cases where companies will charge a %age extra for paying by credit card.

Collabora

bod1467 wrote: »

there are plenty of cases where companies will charge a %age extra for paying by credit card.

yes and more and more companies are doing it now after Visa and Mastercard got together with the FSA (at the time) and lifted the rule that prevented retailers from passing these charges directly onto customers. Even Paypal allow you to pass on the processing charges to customers

Money-Saving-King

Dr._Shoe wrote: »

Broadly speaking, this amounts to an "admin charge" which is illegal, They can ask for reimbursement of the extra costs of processing a credit card payment but AFAIK they cannot charge extra for credit other than interest. They can however offer a discount for cash.

If it were a default amount for all goods. But what about an item in a one off sale with cash payment only?