Why am I charged 2.5% cc surcharge?

gravesend100

Hi
Having worked with commercial payment systems for many years I am aware that recent EU regulations have brought down the surcharge banks apply to credit card transactions.
At one time 2.5% surcharge may have been reasonable but I understand all credit cards now incur a charge to the supplier of around 0.9%
Why are companies, such as online Travel Agents, allowed to charge me the old rate of 2.5% ?
I understand it costs them more to accept credit rather than debit cards but these rates seem unreasonable and excessive - is this another PPI type issue where the public is being duped?

[Deleted User]

The surcharge needs to accurately reflect their costs - which can be more than just merchant fees.

Westminster

I think airlines etc may be compelled by regulation to provide at least 1 'fee-free' payment method (such as debit card)?

eskbanker

gravesend100 wrote: »

Having worked with commercial payment systems for many years I am aware that recent EU regulations have brought down the surcharge banks apply to credit card transactions.

The 2015 EU regulations capped interchange rates between issuing and acquiring banks, but this isn't the same thing as the merchant costs that retail customer surcharges are in place to cover.

gravesend100 wrote: »

I understand all credit cards now incur a charge to the supplier of around 0.9%

As before the costs paid by merchants to card acquiring services remain variable and largely commercially confidential. Merchants aren't allowed to profit from card surcharges but proving that they're doing so is somewhat tricky when their costs aren't known. Where do you get your figure of 0.9% from?

gravesend100 wrote: »

is this another PPI type issue where the public is being duped?

No.

See similar recent threads at
https://forums.moneysavingexpert.com/discussion/5668009
https://forums.moneysavingexpert.com/discussion/5666262

MallyGirl

merchant service charge can be a combo of per_item (fixed cost per transaction) and ad_valorem (percentage of the transaction amount) - it is not a straight percentage at all. The rates used vary massively from merchant to merchant depending on the contract they have negotiated with the acquirer. This is just one of the costs involved. You are over simplifying a very complex thing.