Leap Card agents charging transaction fees

BlueCam · 09-03-2012 12:10AM #1

Is anyone aware of Leap Card agents charging fees for topping up and whether they're actually allowed to do this by Leap/Payzone?

I was catching a Dart at Pearse Station today and hadn't realised my card was out of credit. Was advised by the ticket office at Pearse to go down the road to Centra on Westland Row because, of course, it's impossible to top up a Leap Card at a Dart station... Asked for a €10 top up at Centra only to be told that there was a 25c transaction fee on Leap top-ups, regardless of the amount you top up by. Of course, given that I had to take the Dart, I had no option but to pay it.

It really sickens me that they're taking advantage like this - obviously Pearse Station sends anyone with a Leap Card down their way and there's no way of avoiding the fee unless you want to run over to somewhere on Nassau Street.

(On a side note.. why couldn't they install some of the small Leap Card top-up machines that they have in shops in ticket offices at IE stations until they sort out the automatic ticket machines? Surely this would be a very simple stop-gap measure?)

Carawaystick · 09-03-2012 12:31AM

Pearse station don't do credit card transactions at the ticket desk, asking for leap transactions is a bit much...

ScouseMouse · 09-03-2012 09:44AM

I could see this coming.

Payzone and the NRA are squeezing the shops so hard, the only way the shop can afford to do it is to have a transaction charge. Its like the phone credit issue. The phone companies squeezed the shops by increasing the cost to the shops, but expected them to swallow it.

With the rate shops are closing at the moment, expect it - and more.

Jehuty42 · 09-03-2012 11:16AM

That particular Centra puts extra charges on everything they can and they won't take a credit or debit card unless you make a >€10 transaction. But yes, I expect this to become a trend.

AlekSmart · 09-03-2012 11:55AM

Jehuty42 wrote: »

That particular Centra puts extra charges on everything they can and they won't take a credit or debit card unless you make a >€10 transaction. But yes, I expect this to become a trend.

Shesh...To Hell in a Handcart !! :mad:

Yet another example of an Integrated Ticketing project which was allowed to commence in a half-cocked and poorly thought-out manner.

The Topping-Up of Leapcard,ease,cost and availability is absolutely central to the issue of whether the ITS project fails or moves forward to the next phase.

What is being described above is "Scalping" by the retail agent,something which Payzone and Leapcard need to eliminate NOW.

devnull · 09-03-2012 12:14PM

Is this actually permitted or are retailers chancing their arm?

ScouseMouse · 09-03-2012 12:39PM

It is permitted, its a breach of the competition act for any company to dictate the price anything sells at.

(Price fixing)

mikemac1 · 09-03-2012 12:46PM

Just takes competition to wipe it out

Xtravision never charged extra for phone credit so why pay a small shop the extra?
Over time people would not put up with it so more and more shops got rid of the surcharge.

Some shops had signs in their window proudly declaring they didn't charge. Which isn't something to be proud of, that was how it used to be.

Some retailers trying it again now with Leap. And if people keep paying then they will keep it.
Go elsewhere, not everywhere will charge so give them the business

Victor · 09-03-2012 12:54PM

It would seem this is not permitted. however, superscouse does make an interesting point.

superscouse wrote: »

It is permitted, its a breach of the competition act for any company to dictate the price anything sells at.

(Price fixing)

ScouseMouse · 09-03-2012 01:06PM

Victor, I am sending you a pm.

smackyB · 09-03-2012 01:12PM

Any word on when we can expect the IR machines to be able to topup LEAP cards? I recall someone saying February but that's clearly come and gone

BlueCam · 09-03-2012 01:31PM

superscouse wrote: »

It is permitted, its a breach of the competition act for any company to dictate the price anything sells at.

(Price fixing)

I've studied competition law and this isn't a breach of it - Payzone is not abusing a dominant position. There are many different payment systems in existence and retailers are free to decide which they use/don't use. If they don't like the margin they get on Payzone transactions, they're not forced to use it.

I am assuming that Payzone includes in its agreements with retailers the clause that they may not charge an extra transaction fee on Payzone transactions (or indeed on specific transactions for which Payzone is necessary, e.g. a retailer couldn't decide to charge 25c for O2 top-ups). The reasons for this are obvious - consumers would be rather averse to using the service if different shops charged different transaction fees. Again, this isn't a breach of competition law as long as Payzone is not abusing a dominant position.

foggy_lad · 09-03-2012 01:42PM

AlekSmart wrote: »

Shesh...To Hell in a Handcart !! :mad:

Yet another example of an Integrated Ticketing project which was allowed to commence in a half-cocked and poorly thought-out manner.

The Topping-Up of Leapcard,ease,cost and availability is absolutely central to the issue of whether the ITS project fails or moves forward to the next phase.

What is being described above is "Scalping" by the retail agent,something which Payzone and Leapcard need to eliminate NOW.

one major problem is there seems to be nothing at all coming from Leapcard since the launch of the card, all the promised features are still "coming soon" which seems to be their version of we don't have the ability and don't have the funds to acquire the ability to provide anything more than an e-purse which is worse than cash on the busses!

Now we are seeing issues with the Leapcard agents who not only want to charge payzone leapcard customers extra but they kick up over allowing leapcard customers to load credit unless they have bought something in their shop.

Victor · 09-03-2012 01:46PM

BlueCam wrote: »

I've studied competition law and this isn't a breach of it - Payzone is not abusing a dominant position. There are many different payment systems in existence and retailers are free to decide which they use/don't use. If they don't like the margin they get on Payzone transactions, they're not forced to use it.

While there are other systems like PostPoint / Bill Pay / MyBills.ie are we certain that Payzone doesn't have a huge part of the market, especially in certain product lines? Certainly PayPoint aren't exactly high profile.

ScouseMouse · 09-03-2012 01:48PM

As the only supplier to shops, payzone are in a dominant position, shops cannot get it elsewhere.

And, any agreement can be overturned or be deemed unenforcable if it is shown to be illegal or anti competative.

You could still charge a tenner for a tenner top up but a transaction fee could be deemed seperate and so you are only paying a tenner for it - any extra could be for the service of the staff.

ScouseMouse · 09-03-2012 01:50PM

foggy_lad wrote: »

Now we are seeing issues with the Leapcard agents who not only want to charge payzone leapcard customers extra but they kick up over allowing leapcard customers to load credit unless they have bought something in their shop.

In other words, the shops are expected to provide the service for nothing.:rolleyes:

Only in Ireland could it be fecked up so badly.

BlueCam · 09-03-2012 01:59PM

Victor wrote: »

While there are other systems like PostPoint / Bill Pay / MyBills.ie are we certain that Payzone doesn't have a huge part of the market, especially in certain product lines? Certainly PayPoint aren't exactly high profile.

Fair point but it depends on the market definition. I am certain Payzone would argue that the market isn't simply that they "provide payment solutions to independent retailers" - they would argue that each service they provide is a market in itself, given that in almost every case there is an alternative means for a consumer to avail of it, e.g. for a mobile phone top-up I am sure online top-ups account for a far larger proportion of sales than Payzone top-ups. There may be individual services where Payzone is either the sole means of payment or where Payzone payments account for a monopoly of market share, but I have a feeling that for most of its services this isn't the case.

ScouseMouse · 09-03-2012 02:03PM

BlueCam wrote: »

Fair point but it depends on the market definition. I am certain Payzone would argue that the market isn't simply that they "provide payment solutions to independent retailers" - they would argue that each service they provide is a market in itself, given that in almost every case there is an alternative means for a consumer to avail of it, e.g. for a mobile phone top-up I am sure online top-ups account for a far larger proportion of sales than Payzone top-ups. There may be individual services where Payzone is either the sole means of payment or where Payzone payments account for a monopoly of market share, but I have a feeling that for most of its services this isn't the case.

Quite right on some of your points.

Payzone are the ONLY suppliers to shops for Toll payments and Leap Top ups.

This is what puts them in a dominant position.

The last thing I am going to say is: complaints, from retailers, by email, to the competition authority, cc'd to payzone, does get results.:p

foggy_lad · 09-03-2012 02:07PM

I sent an email to Leap customer services and they responded by saying there should not be any service charges on topping up and went on to say it was probably that the customer got their €10 top up and found they only had €9.75 on the card because they had eaten into the deposit on the card, not a great response tbh.

Hello ******,

Thank you for your email. From what we know there should not be any service charges on topping up the leapcard in any payzone store. A usual case that we have seen is people think there is a service charge when they top up by e.g. €10 and only have €9.75 on there card this usually means that they went into there deposit so before they topped up they were in a negative balance of -€0.25 hence when topping up by €10 they only have €9.75 on their card. I hope this information helps.

Kind Regards,
****** ********,
Leap Card Customer Care

foggy_lad · 09-03-2012 02:12PM

superscouse wrote: »

In other words, the shops are expected to provide the service for nothing.:rolleyes:

Only in Ireland could it be fecked up so badly.

Yes!

If the shops don't like the deal offered to them by Payzone Postpoint etc they don't have to use those services! most people going into a shop to pay a bill or toll or top up their phone or leap card will usually buy something else.

Imho the shops are just being greedy like they were with mobile top-ups.

BlueCam · 09-03-2012 02:13PM

superscouse wrote: »

Quite right on some of your points.

Payzone are the ONLY suppliers to shops for Toll payments and Leap Top ups.

This is what puts them in a dominant position.

The last thing I am going to say is: complaints, from retailers, by email, to the competition authority, cc'd to payzone, does get results.:p

You are correct, but in the case of Leap, Leap top-ups in shops isn't a market in itself - it is a component of the overall market for Leap top-ups, for which there are a number of other ways of paying - namely online and at Luas machines. If 90% of Leap top-ups turned out to be done via Payzone then of course it could still be argued that Payzone has a dominant position in the market for Leap top-ups, but if the split is 33-33-33 across Payzone/online/Luas machines, then this would not constitute a dominant position.

Even if Payzone was found to be in a dominant position, it could then argue that because neither online nor Luas machine top-ups incur transaction charges, in order to compete effectively it is obliged to stop its retailers from charging an extra fee (on the basis that otherwise, consumers would not use Payzone because it costs them more).

antoinolachtnai · 09-03-2012 02:32PM

Dominance has nothing to do with it. An agreement between undertakings to distort competition in trade of goods or services is forbidden. To fix a price at a particular level is forbidden.

http://www.irishstatutebook.ie/2002/en/act/pub/0014/sec0004.html#sec4

BlueCam · 09-03-2012 02:40PM

antoinolachtnai wrote: »

Dominance has nothing to do with it. An agreement between undertakings to distort competition in trade of goods or services is forbidden. To fix a price at a particular level is forbidden.

http://www.irishstatutebook.ie/2002/en/act/pub/0014/sec0004.html#sec4

You're misreading the Act. It states that fixing selling prices is only prohibited in the case of "agreements [...] which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services". In order for a firm to prevent, restrict, or distort trade, in practice this firm must be in a dominant position - otherwise it would have no control over the market and any attempt at the above would not be successful.

ScouseMouse · 09-03-2012 02:45PM

From a RETAILERS point of view, they can only buy from one supplier - Payzone. There is no 33/33/33 split.

antoinolachtnai · 09-03-2012 02:47PM

That is not what the Act says. You might wish this is what the Act says, but the idea that it is OK to fix prices as long as you are a sufficiently small player is ridiculous and wrong. Unfortunately this idea seems to be widespread.

You may be mixing up section 4 with section 5, which deals with an undertaking in a dominant position.

Victor · 09-03-2012 02:58PM

BlueCam wrote: »

You are correct, but in the case of Leap, Leap top-ups in shops isn't a market in itself - it is a component of the overall market for Leap top-ups, for which there are a number of other ways of paying - namely online and at Luas machines. If 90% of Leap top-ups turned out to be done via Payzone then of course it could still be argued that Payzone has a dominant position in the market for Leap top-ups, but if the split is 33-33-33 across Payzone/online/Luas machines, then this would not constitute a dominant position.

On-line top-ups are via Payzone.

Victor · 09-03-2012 03:11PM

antoinolachtnai wrote: »

That is not what the Act says. You might wish this is what the Act says, but the idea that it is OK to fix prices as long as you are a sufficiently small player is ridiculous and wrong. Unfortunately this idea seems to be widespread.

You may be mixing up section 4 with section 5, which deals with an undertaking in a dominant position.

Potentially the contract is structured as NTA / Leap says Payzone / Luas / Irish Rail can only charge X% commission on sales.

Payzone are then offering to retailers one of two options (a) We need you to give €10 top-ups, how much commission do you want, which we will pay you? (b) We need you to give €10 top-ups, we are offering Y% commission, do you want to take part in the scheme?

Not all Payzone agents take part in Leap. Payzone isn't the only way to get a Leap top-up, although they have about two-thirds of the top-up locations.

ScouseMouse · 09-03-2012 03:37PM

My understanding, as a retailer, is, I cannot get supply of the leap top up anywhere else. Payzone is the only supplier available to me.

Is there another place I can get them wholesale?

Gingernuts31 · 09-03-2012 03:41PM

I work in a Garage and we use payzone. We don't charge for phone credit but we do charge for topping up 3V cards and the o2 money topup card. I don't think we charge for anything else. We don't do leap cards as we are not in Dublin.

BlueCam · 09-03-2012 04:07PM

superscouse wrote: »

My understanding, as a retailer, is, I cannot get supply of the leap top up anywhere else. Payzone is the only supplier available to me.

Is there another place I can get them wholesale?

You're fundamentally misunderstanding the purpose of competition law and the case law behind it. Competition law has never been designed to protect retailers - it is designed to protect consumers from producers who exploit market power. I know that seems hugely unfair as a retailer, but unfortunately it is true.

This page gives a good overview of market definition, specifically: "a relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer by reason of the products' characteristics, their prices and their intended use". In the case of the Leap Card, buying at a shop would be considered interchangeable with buying online which would be considered interchangeable with buying at a Luas machine because the characteristics, price, and intended use of the service are all identical.

I agree that there is nowhere else you as a retailer can go to get Leap top-ups, but the market for shops selling Leap top-ups is not protected under competition law. It is merely a component of the overall Leap top-up market. In effect, Payzone has offered you a service, with a profit margin of x%. If you don't think that margin is enough, you don't have to sell the service they are offering. It's not anti-competitive behaviour on their part. What would constitute anti-competitive behaviour, for example, would be if Visa or Mastercard created a rule that said retailers could only accept one or the other. Or if the two of them decided to raise their fees on retailers in unison. That is anti-competitive because they are abusing their dominant position. Does that make sense?

foggy_lad · 09-03-2012 05:56PM

The latest from leap customer service is that the charge can be applied at the shopkeepers discretion and can be any amount they choose! What use are leap customer service? They don't process refunds, they can't protect customers from shopkeepers adding on charges to your top-ups.

Leap Card agents charging transaction fees

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