Credit Card Fees

[turtlemichael]

Has anyone noticed that Hilton in Australia appear to have increased their credit card fees to 2%?

 

[lowan74]

I noticed this last week in Brisbane and was a bit taken aback. Certainly higher than other competitive hotels (Sofitel, Westin etc). Complained and got a response from the hotel:

My comment (in a review) was : "The other change since my previous stay is that this Hilton has increased their credit card surcharge to 2%. Really – Hilton needs to get a new bank that charges a lower rate. Where other hotels are ranging from 0-1.5% this reflects very poorly on the brand. I can readily find major Australian banks offering ~1.1% merchant fees. I understand that surcharges can only relate to the actual costs of accepting a card – if this really is 2% Hilton needs to find a better merchant facility."

Their reply was:

"I do note your sentiments regarding the credit card surcharge. Our credit card surcharges, currently set at 2%, are in line with industry standards and in certain cases even lower than what some of our competitors are implementing. These charges are not arbitrary; rather, they are a response to the fees imposed on us by credit card companies for processing transactions."

Won't be staying at Hilton Brisbane as a preference in future.

 

[Happy Dude]

That's an incredibly insincere, condescending and inaccurate response @lowan74. Par for the course for Hilton.

 

[moa999]

Wonder what the ACCC would say about it.

Card surcharges

Businesses can charge a surcharge for paying by card, but the surcharge must not be more than what it costs the business to use that payment type.

www.accc.gov.au

 

[Zero]

in line with industry standards and in certain cases even lower than what some of our competitors are implementing.

I have yet to come across a business surcharging more than 2% for Visa and Mastercard anywhere in Australia. And the only place I know apart from Hiltons that surcharges exactly 2% (legally or not) is a Chinese restaurant, which only does it to encourage patrons to pay in cash.


But on the other hand, as an international chain Hilton probably sees higher use of foreign Visas and MCs, as well as Amex. A 1.1% merchant facility for local cards is achievable, but banks offering that on all Visas and MCs are likely to lose money. This may explain Hilton's recent rise from 1.5% to 2%.

Even in Europe (where of course the "industry standard" as well as the legal position is for the hotel to absorb all the costs) it would be difficult to get fees down to 1.5% for foreign cards.

When you can just pass the charges on to customers in Australia, there isn't any incentive for businesses to negotiate lower fees...

Wonder what the ACCC would say about it.

The ACCC says

If there is no way for a consumer to pay without paying a surcharge, the business must include the surcharge in the displayed price.

Is there a way to pay Hilton Brisbane without the surcharge? They don't accept cash.

Before covid, when I stayed there on Advance Purchase rates, I got charged exactly the amount stated on the booking.

I stayed once after covid and assumed this was still the same, but after I left I saw that they charged the surcharge on check-out (3 months after the original payment), which makes no sense. If they are actually charged 2% for every transaction, they would have been charged another 2% on the "surcharge" charge!

I won't stay there again unless on points or the rate is really low (which I doubt will happen). On the positive side, they provided full diamond breakfast without the now normal $10.20 extra charge

 

[exceladdict]

Saw this just now on the Hilton website in advance of an upcoming stay:



This amounts to $40 on my upcoming stay.

While 2% might very well be Hilton's average cost of taking all electronic payments, I agree with earlier posters that it is very unlikely they will incur a charge of exactly 2% from whichever payment method I choose.

 

[exceladdict]

ACCC website mentions that

• If there's no way for a consumer to pay without paying a surcharge, the business must include the minimum surcharge payable in the displayed price for its products
• If a business wants to set the same surcharge for all payment types, it must not be more than the lowest surcharge they would set for a single payment type