Possibly good news for credit card users - Sorry its for England! - We can only hope!

Biggins

You can see RyanAir fighting this one!

Travel Firms Ordered To Scrap Card Charges

Airlines and travel companies face the threat of legal action if they continue to spring hidden charges on customers who pay by debit and credit cards.

Airlines and travel companies face the threat of legal action if they continue to spring hidden charges on customers who pay by debit and credit cards.

An investigation by the Office for Fair Trading (OFT) found "considerable evidence" of drip-pricing - where surcharges are added to the total price only after people have clicked through a number of web pages.
The watchdog described the practice as "misleading" as it released findings of a 90-day review following a super-complaint by Which?, the independent consumer body.
However, some airlines, such as Ryanair, said all "optional" fees are avoidable and that the investigation would not change the way it did business.
The OFT did not name the worst offenders, but pointed out that easyJet charges £8 per card transaction after customers pass through eight web pages. Ryanair adds £6 after four pages.

The OFT is asking the Government to change the law so that all debit card surcharges are scrapped.
It says that a number of rail, airline and ferry companies have already agreed to scrap them, but some firms have refused point blank.
The OFT said it would consider legal action if the situation does not change.
The review points out that in many cases the consumer has no option but to use a credit or debit card and they are effectively being made to pay for paying.
One of the airlines to scrap debit card charges is Monarch.
A spokesman told Sky News: "There is no justification for charging excessive fees on credit and debit cards.

"We had already taken the decision to cancel debit card fees some time ago following an intensive six month review.
"Our customers expect an up front and transparent pricing structure from their airline and it's good to see that in light of this important decision, other airlines will now have to follow our lead."

The OFT did not explore credit card charges because of the complex, multi-layered pricing structure.
However, the Consumer Rights Directive, which is currently going through the European Parliament, would, if successful, force governments to ensure that only the bare minimum is charged for credit card transactions.
Which? welcomed the OFT's review and urged all online companies to take the recommendations onboard.

http://news.sky.com/skynews/Home/Business/Card-Charges-Travel-Firms-Told-By-Office-For-Fair-Trading-To-Stop-Hidden-Costs/Article/201106416020431?lpos=Business_Carousel_Region_3&lid=ARTICLE_16020431_Card_Charges%3A_Travel_Firms_Told_By_Office_For_Fair_Trading_To_Stop_Hidden_Costs

Are you listening Mr Kenny?
Can you do the decent thing and also stop this mad charging rip-off?

TheZohanS

Their CC charges aren't hidden.

Biggins

TheZohan wrote: »

Their CC charges aren't hidden.

No but their supposed excessive charges just for using credit cards have been deemed to be unjust or unfair it might appear - and at least someone is doing something to change this racket.

Fratton Fred

UK Mr Biggins, UK ;-)

Seachmall

Surely if you pay by credit card without looking at the final total charge you are an idiot and do not deserve to own a credit card?

Biggins

Fratton Fred wrote: »

UK Mr Biggins, UK ;-)

Yea, I know but oft times we seem to follow in the steps of England.
If we were to follow similar in this, it would be a plus for anyone here.

Seachmall wrote: »

Surely if you pay by credit card without looking at the final total charge you are an idiot and do not deserve to own a credit card?

True.
Sadly, some excessive "admin" charges are ridiculous, unavoidable and its these that should be looked at here also.
...Thats if our consumer org here had teeth to tackle such issues - but it don't.

Cookie_Monster

Biggins wrote: »

Can you do the decent thing and also stop this mad charging rip-off?

So if the 6 quid charge is scrapped all tickets will go up by 6 quid and everybody is affected rather than only most people...

Biggins

Cookie_Monster wrote: »

So if the 6 quid charge is scrapped all tickets will go up by 6 quid and everybody is affected rather than only most people...

Well at least it would be more honest and other products such a tickets from Ticketmaster might need to readjust their excessive (I feel) CC charge?

Its either a genuine CC charge or a charge just to rake pure profit.
Clearer legal definition would at least clear up the matter.

dfx-

Cookie_Monster wrote: »

So if the 6 quid charge is scrapped all tickets will go up by 6 quid and everybody is affected rather than only most people...

You may as well have £6 more expensive flights as opposed to the £6 cheaper flights with the £6 then added on anyway as it is now..no cost difference

Biggins

Some of the issues that "Which" took the claim to the OFT is the charging of every single ticket.
For example, Ryanair (and others) reportedly now charge in some cases for CC use for two people going out and two charges for CC use for the return flight - even though the actual purchase of ALL the flights was made with just one card with one visit to their website.

The full complaint that "Which" took to the OFT asked that this be looked at too.

Latchy

As regular flyer to Dublin and abroad from UK who uses CC/DC to book flights online , I welcome this new rule by our new office of fair trading overlords.

Thoie

The credit card fees that merchants are charged are normally based on a percentage of the amount being paid. I don't mind toooo much paying for using the credit card. I'd prefer not to, but I can understand that, particularly for small businesses, the 2.5% they lose to the CC company can hurt.

I'd prefer to see these charges built into the fares. Companies are well able to build in their profit margin (which is usually a percentage), so why not the CC charge as well? Places that accept cash can always offer a cash discount of the same amount if they feel that way inclined.

I dislike flat CC charges. If I get a £10 flight on easyJet, but have to pay £8 as a CC charge, I'm being done - they're pocketing an extra £9+ profit. Unless my flight costs over £300, the charge should be nowhere near that.

Biggins

The Times (England) write up and Analysis piece:

The consumer watchdog has called on the Government to ban retailers from charging people to pay with debit cards and force traders to be more transparent about credit card charges.

The proposal comes in the response of the Office of Fair Trading (OFT) to a super-complaint by the consumer group Which? about surcharges, which are a huge money-spinner for travel companies in particular, earning an estimated £300 million in 2010 for the airlines alone.

According to Which?, debit card payments cost 20p to process and credit card payments cost companies no more than 2 per cent of the transaction value.

One of the “worst offenders” highlighted by Which? is Ryanair. A family of four booking a return flight with the airline would pay an extra £48 by debit or credit card, while the estate agent Foxtons charges £25 to pay a £5,000 deposit to rent a flat with a debit card.

The OFT has warned travel companies to clean up their act or face enforcement action after a 90-day investigation resulting from the Which? complaint.

The watchdog found that many travel companies are using “drip pricing” to add extra charges throughout the payment process.

It said that these practices can mislead customers when the extra payment charges come as a surprise and are very difficult to avoid.

It said that traders should not be allowed to charge for debit card payments, which are the online equivalent of cash, but that they should be allowed to charge for the processing costs of paying with credit cards, provided that this is done transparently.

Cavendish Elithorn, senior director of the OFT’s goods and consumer group, said that the growth of internet retailing has brought massive benefits, but customers are frustrated that they are being charged for making card payments when goods cannot be purchased online with cash.

“Consumers find it harder to shop around and find the best deal if they have to invest time and effort in discovering surcharges,” he said. “This also weakens competition between retailers, which is bad news for the UK economy.”

Mr Elithorn added: “We believe there is also a strong case for a change in the law so that the cost of using a debit card, the almost universal payment method for today’s online consumers, is always included within the headline price.”

Peter Vicary-Smith, chief executive of Which?, said: “Thousands of people have told Which? that hidden or excessive card fees are unfair, and we’re delighted that the OFT supports this view - it’s a victory for consumers.

He called on the OFT to take immediate steps to ensure that consumers know the true cost of their purchases upfront. “Businesses can start to be upfront and fair over card charges today – there’s no point waiting until the OFT forces action. Industry shouldn’t drag its feet over this.”

Some companies have already removed card fees because of a backlash from consumers.

Conrad Clifford, chief executive of Monarch Airlines, said: “There is no justification for charging excessive fees on credit and debit cards.

“Our customers expect an upfront and transparent pricing structure from their airline and it’s good to see that in light of this important decision, other airlines will now have to follow our lead. Let us hope they do so without any handwringing or prevarication.”

http://www.thetimes.co.uk/tto/money/consumeraffairs/article3077197.ece

Analysis

Analysis Andrew Ellson
Last updated June 28 2011 12:46PM

The Office of Fair Trading (OFT) faces an uphill battle to stop companies levying debit and credit card surcharges – at least if the reaction of Ryanair today is anything to go by.

In a statement, the no-frills airline said that it will be unaffected by the findings of the OFT report because it does not levy any card surcharges. Most of its 75 million customers, who face card charges of £6 per passenger per journey, may be a tad surprised by that analysis.

The airline’s statement said: “Ryanair does not impose any such debit/credit card fees. Ryanair’s optional fees, including its administration fee, are fully avoidable by all passengers.”

The airline’s justification for this perverse position is that the fees can be avoided by customers who use a certain type of prepaid MasterCard. Of course, the reality is that the vast majority of customers have no alternative but to pay. For Ryanair to call its card surcharges “optional fees” is disingenuous in the extreme.

The simple fact that no amount of semantics can disguise is that Ryanair – and others who use card charges – are being misleading about their prices. Customers want to know upfront the full cost of what they are buying. If you go to Tesco, you don’t expect to see one price on the aisle and then extra “admin fees” added at the checkout.

The OFT should eventually be able to stop this practice – but not before an extended legal tussle with the likes of Ryanair. Ultimately, legislation may be required so don’t expect these fees to disappear overnight.

Quite why Ryanair objects so much is hard to fathom. If its prices are as competitive as it claims, there is no reason to fear making them clear.

http://www.thetimes.co.uk/tto/money/consumeraffairs/article3077276.ece

The OFT has a clear point.
The FULL price should be in their advertisements, not this drip, drip, later charges added on subsequently.

latenia

Please stop spamming After Hours with your outraged voice of the little man schtick Biggins; it's beyond tedious at this stage.

Biggins

latenia wrote: »

Please stop spamming After Hours with your outraged voice of the little man schtick Biggins; it's beyond tedious at this stage.

I'm mentioning a report and news, hoping also that similar can be done here.
Please attack the post - not me!
If you have problem with a post - use the report button.

We are here discussing matters - not just what you like to just read.
We were having a good discussion on the matter up till now.

biko

latenia, if you have an issue with another poster please report it and a mod will be along to sort it out, thanks.

Biggins, as this doesn't concern Ireland per se I'll lock it but feel free to start a thread in Travel for the peeps that travel to/from UK.