$6 Credit Card surcharge that Qantas charges

[kort]

Just wondering how come Qantas (and Virgin Blue) are allowed to charge an additional $6 when buying for a plane ticket online via credit card? Given that the only way to pay is via credit card, it just seems a bit of a rort. When I purchase other items online from other stores, I certainly don't get hit with such a ridiculous charge.....I have been paying it for years but I have only gotten around to having a whinge on a forum now

I saw on the Virgin Blue site they are charging the $6 as it is "in line with Industry Practice" - what kind of BS is that?! Given I am already paying for the airline ticket + other taxes I have no idea about, it seems a bit rich for the airlines to then charge an extra $6 just to process my credit card when other companies do it for nothing?!

thoughts?

 

[JohnK]

I think the actual credit card surcharge is $7.70 for each domestic QF booking and $3 for each domestic DJ sector. They are allowed to charge it because the RBA intervened a few years ago and said it was OK to have surcharges on credit card payments to cover the cost of the transaction.

I think it quite clear that QF and DJ credit card surcharge, and TTs $5 convenience fee, more than covers the cost of the transaction. Nothing we can do about it because the gutless wonders with all the power allow this sort of rubbish....

 

[oz_mark]

Just wondering how come Qantas (and Virgin Blue) are allowed to charge an additional $6 when buying for a plane ticket online via credit card? Given that the only way to pay is via credit card, it just seems a bit of a rort.

Last time I checked, the Qantas surcharge was $7.70, and it can be avoided by using BPay to pay for the ticket.

 

[lovetravellingoz]

Plus QF charge $25 for International Flights.

 

[Keith009]

Plus QF charge $25 for International Flights.

SQ is also charging it out of Australia now:
SQ to charge credit card fee - SQTalk

 

[dajop]

I don't know how it averages out across all transactions, but many suggest QF would be paying <1% merchant fees for credit card transactions. On this basis any bookings <$770 it is certainly just profit taking for QF. DJ no different.

What is so annoying is that credit cards have facilitated significant reduction on distributions costs for airlines over the last 10 years, with the move of transactions away from travel agents and direct to the airline through online booking engines - without credit cards that would have been much more difficult, as BPAY has limitations that credit cards don't. Oh well, that's what happens when you live in the land of the duopoly.

 

[JohnK]

I don't know how it averages out across all transactions, but many suggest QF would be paying <1% merchant fees for credit card transactions. On this basis any bookings <$770 it is certainly just profit taking for QF. DJ no different.

And for the average person how many domestic airfares are >$770?

With the recent QF and DJ specials I mixed and matched some SYD-BNE-SYD flights and I was left with 2 bookings on QF involving only a one-way flight. The cost of the flight was $65 and the credit card surcharge was $7.70, a whopping 11.84%. :shock: Makes perfect sense to me that it is just cost recovery.

We will never have serious competition in Australia as long as airlines are allowed to manipulate fuel surcharges, credit card surcharges etc....

 

[trippin_the_rift]

We will never have serious competition in Australia as long as airlines are allowed to manipulate fuel surcharges, credit card surcharges etc....

Agreed. CC surcharges are a fking scam. The RBA needs to restrict CC fees to the same % as what the bank charges the merchant. Problem solved.

 

[bambbbam2]

I booked a trip last week and nearly choked when I saw the $25 fee!

I think I will bpay, thanks QF..

 

[yangry]

I think as long as they provide other means of paying that doesn't attract a fee, I don't have a problem with it.

Pity the same can't be said to other airlines in Australia, especially LCCs. If you have to pay by a credit card and paying by a credit card costs, then why not just make it part of the advertised fee?

 

[JohnK]

Pity the same can't be said to other airlines in Australia, especially LCCs. If you have to pay by a credit card and paying by a credit card costs, then why not just make it part of the advertised fee?

It is all part of the illusion. If they leave all the add-ons off the advertised airfare then it looks like it is a cheap airfare. Not so cheap when all the add-ons are included in the final price....

 

[dajop]

I think as long as they provide other means of paying that doesn't attract a fee, I don't have a problem with it.

Trouble is, inside 7 days there is no option of BPAY.

If the fee reflects the cost of the transaction, I don't have a problem with it either, somewhere in the order of 1% is really not that significant. However $7.70 on a $65 airfare, as cited by JohnK is IMHO outrageous. That is definitely not in the spirit of the RBA reforms. But anybody who would be a position to take QF on this regard is probably too scared of losing their CL membership

 

[odysseus]

SQ is also charging it out of Australia now:

Guess they had to conform to 'industry practice.'...

(edit: this link restriction is a pain - I had to edit it out of the quote!)

 

[oz_mark]

However $7.70 on a $65 airfare, as cited by JohnK is IMHO outrageous. That is definitely not in the spirit of the RBA reforms. But anybody who would be a position to take QF on this regard is probably too scared of losing their CL membership

It is up to the acquirer as to whether they impose a limitation on how much the surcharge can be, and really I can't see what a bank would care!

As for the spirit of the RBA reforms, one of the goals was that a credit card user should pay more as it is a relatively expensive compared to the alternatives. In this case, I think the RBA got more than what they were after.

Having said that, I do think that the fee is outrageous, and I am not sure why they don't just charge a flat percentage.

 

[opusman]

As for the spirit of the RBA reforms, one of the goals was that a credit card user should pay more as it is a relatively expensive compared to the alternatives.

IIRC one of the stated goals was that prices would come down in general, as the credit card overhead would no longer need to be factored in to the base price. Of course we've all seen prices come down, haven't we

 

[oz_mark]

IIRC one of the stated goals was that prices would come down in general, as the credit card overhead would no longer need to be factored in to the base price. Of course we've all seen prices come down, haven't we

Of course, the idea was tha cash prices would come down, and that people using Credit Cards would pay more for the privilege. We certainly got the second half of the equation!

 

[simongr]

How is a credit card more expensive than cash? You have no security issues, reduced staff theft and fraud, don't have to count and transport cash...

As with the majority of consumer based activity by "auithorities" in this country the consumer never wins...

 

[JohnK]

Credit card transactions are cheaper than cash. That is why companies like the one I work for only accept electronic forms of payment.

I think they are comparing credit card transactions to debit card transactions (BPAY) but I don't see the difference between these transactions anyway.

 

[AnonymousCoward]

I think they are comparing credit card transactions to debit card transactions (BPAY) but I don't see the difference between these transactions anyway.

How do you figure this? It costs the merchant more to accept/process a CC transaction.

Which is why you see a bunch of places charging extra for CCs, and nothing extra for BPay/EFTPOS

 

[Soundguy]

That is why companies like the one I work for only accept electronic forms of payment.

Which is illegal. Australian (fiat) money is still marked "legal tender throughout Australia and its territories". You have to accept it by law.

My business only accepts payment in cash, by EFT, cheque, Paypal or in precious metal.

Using Bpay for a flight is fine if you have the time available and the cash on hand but then you miss out on any travel insurance that many credit cards feature.