Warning. Tesco CC Now Charge You Fee If You Give to Charity

doleawg · 4 July 2018 at 4:15PM

Tesco credit card has changed its rules that if you use the card to pay for a service i.e. do not buy a physical item then you will get charged a cash transaction fee and interest.This includes any payments to Justgiving etc. Just happened to me and they will not budge on the fee.

Crooks.

T-G-C · 4 July 2018 at 4:37PM

It doesn't necessarily limit to a physical product, that would be ludicrous, it is limited to purchase transactions e.g where there is no cash value.

A charity donation is giving money, there is no product or service involved, hence you are not making a purchase. For charities, you should only donate when affordable from a debit account. I admire your generosity, but Tesco still have to treat it the same as any other cash transaction sadly.

I feel in this specific scenario, not taking these "changes" you mention into consideration, as I am not a customer, that the charges are correct and as of normal practice. Like I said, I don't know what the rules were before, it could simply be that charity donations were previously slipped through the net, but now they've clicked on and updated the system.

Gift cards, foreign currency, withdrawing cash, money transfers, charity donations or anything that has a cash value or the exchange of cash will involve the appropriate fees and interest. This is the same for most credit cards, unless otherwise exempted.

Purchases are things like groceries, products or services from a retailer or anything that doesn't directly carry a cash value, like the examples above.

thrifty_pete · 4 July 2018 at 4:43PM

Sounds a bit weird. Like they're trying to stop you topping up online payment accounts. Would this affect PayPal? I hope other banks don't copy this policy.

T-G-C · 4 July 2018 at 5:09PM

thrifty_pete wrote: »

Sounds a bit weird. Like they're trying to stop you topping up online payment accounts. Would this affect PayPal? I hope other banks don't copy this policy.

If the online account being topped up is cash based, like a gambling balance, it is considered a cash transaction exclusively in most cases. This is correct and I have no problem with that.

A charitable donation is not topping up an online account, it is essentially using a debit card to send currency to a not-for-profit organisation - which is considered a cash transaction.

Tesco on the other hand, are not a not-for-profit organisation and therefore do not exclude donations from the cash interest plan, nor are they under obligation to do so.

As for PayPal, making normal purchases using your credit card is fine, Tesco will not have a problem with that being classed as such, but sending money on PayPal or otherwise dealing currency through it could be categorized as cash. Some people claim that sending money using a credit card on PayPal is not classed as cash with your provider, although there is no definite answer and I think PayPal charge a processing fee for sending money under Family and Friends using a credit card, so can't escape the fees regardless.

chattychappy · 5 July 2018 at 8:56AM

T-G-C wrote: »

If the online account being topped up is cash based, like a gambling balance, it is considered a cash transaction exclusively in most cases. This is correct and I have no problem with that.

You pay fees there not because it's cash based, but because it's gambling and they've treated gambling differently for a long time regardless of whether there is an online balance or some other mechanism. I think it was an arbitrary carve-out because of the peculiar risks involved.

My "oystercard" maintains a cash balance for pay-as-you-go on trains etc. You can top up with cash or card. I can top up with credit card - no problem, no fee.

The lines are becoming blurred. In the past, it really was just cash (including foreign currency, travellers cheques) that was treated as cash. Most transactions were manual and you had a different coloured voucher to sign which made it clear at the point of sale. You weren't allowed to gamble on credit.

Now the essence of it is if you want a "cash amount" delivered to somebody then it's "cash". It it's "cash/currency etc" then it's "cash". If it's gambling, it's "cash". But for anything else - including an online account/oyster type thing where the stored balance is really paying for a purchase in advance - then it's "purchase".

In the case of giving to charity, you are not buying anything. You are delivering money.

RG2015 · 5 July 2018 at 11:27AM

I always use my NatWest credit card for donations to charities and have never been charged any fees or interest.

It would be interesting to find out if this is just Tesco Bank and whether it only Justgiving and not all charities that give rise to this issue.

WillPS · 5 July 2018 at 11:44AM

I imagine this comes under their ridiculous blanket ban on any and all payment services they don't like the look of.

Complain, and escalate it to the financial ombudsmen when they refuse to budge.

EarthBoy · 5 July 2018 at 12:31PM

RG2015 wrote: »

I always use my NatWest credit card for donations to charities and have never been charged any fees or interest.

Nationwide doesn't charge either.

Pedr057 · 19 July 2018 at 2:43PM

I'm currently in dispute with Tesco Bank after they charged me a transaction fee and interest on it for using the Clubcard credit card to pay (in full) for insurance. They've not done this before and claim it's in the new Ts&Cs. In the new Ts&Cs there's no mention of insurance payments being deemed "Repaying borrowing (including loans and mortgages)" as they claim, just gambling, cash transactions from ATMs etc.

Warning. Tesco CC Now Charge You Fee If You Give to Charity

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