Credit price for goods more than cash price

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agrinnall wrote: »

Well maybe they do, but is that the case in other sectors, or is it just these two that are operating that way?

Yes others that offer credit terms all run this way. if you use cash or by card then that's a simple transaction, if you want credit then a company has to do a credit check (which costs them). Experian charge retailers £20 per search (well they did 6 years ago when i checked them out when i sold PCS), so they will add this into what they charge for offering credit then a fee for them to setting up the credit.

InsideInsurance

This seems to be a fairly confused issue.

Charges for payment method where the credit is not being arranged/ supplied by the merchant are fine but must be proportional to the total cost of accepting that payment method. This will mainly come up in credit card payments and should really be a low single digit percentage.

Where the merchant arranges/supplies the credit (either directly or via a third party) then things probably get more complicated. Whilst I can see no reason why they cannot charge a fixed fee for this in addition to any interest rate the requirement of an APR figure is that it reflects the total cost of borrowing £1,200 over 12 months including both interest and fees (hence some premium credit cards having a 54% APR etc because of their high annual fee)

I'd query if the merchant is charging a fee for paying by credit if this shouldnt be included in the APR calculation. Similarly how this holds up if its more a "cash discount" rather than Credit Charge.

agrinnall

bod1467 wrote: »

Considering you didn't reply to this thread until AFTER post #16 (which is much clearer than what was described in the OP) then I find your comment somewhat fatuous.

I can see why you might think that, I just didn't have time to post on the thread earlier. While the later post from the OP did indeed add clarity, I didn't have any difficulty understanding what was implied by:

buff-tom wrote: »

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?

Everybody else seemed to be reading it as the £20 was the interest charge, which really isn't what a literal reading would reveal.

JethroUK

buff-tom wrote: »

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

Get your money back!!!

Credit/finance attracts interest, which by definition increases the price you pay over and above cash price