[資訊分享] Credit card surcharges - experiences from Australia

For those who don't know what I mean by credit card surcharges,it refers the ability for merchants to charge surcharges for a customer using credit card surcharges (e.g.2%)compared to using cash.

This is currently against Visa/MC rules in HK and most of the rest of the world.So most merchants in HK include it in the base price of everything,whether we pay for it by cash or otherwise.It is,however,legal in Australia due to Reserve Bank of Australia (Australian monetary authority)regulation which overrode the Visa/MC rules (which are essentially contracts).Furthermore,Visa and MC were forced into a settlement in the US this week which would give US merchants similar rights as Australian merchants http://www.washingtontime ... titrust-lawsuit,which made me to consider the topic and to wonder what will happen if this would be imposed in HK.

This fee can be levied as a separate component of the price (e.g."tuition fee for semester:A$10,000,2%surcharge for payment by credit card").However there must be a way to get out of it (e.g.cash,Visa Debit),or else it must be included in the price.

As an aside,reward programs are now very poor in Australia compared to HK.Rewards for using Visa are very low - only Amex earns rewards close to HK (generally A$1/mile like DBS Black).All cards have annual fees which can only be waived by other relationship with the card issuer e.g.mortgage,co-branded card with a professional body.

Here are some examples in Australia:

1.Qantas apparently charges all customers A$6 for using a credit card to purchase a domestic flight.The alternative is an Australian-issued Mastercard debit card.This has been controversial because there is no method for an overseas customer buying a domestic ticket to avoid the fee,but I believe this is unresolved.

2.My car rental company also imposed a 1.95%surcharge on credit cards which I cannot avoid by paying cash.EFTPOS (EPS)was not available - this was also clearly stated on check-in.I asked what was the surcharge-free alternative and was told it was an Australian-issued debit card again.Damn!I paid the fee.

3.All tolls in Sydney must be paid for by credit card - even for visitors renting cars.I must register a credit card against my rented car licence number for the duration I rented it.An account set-up fee is imposed but this is not labelled as a credit card surcharge.

4.David Jones and Myer (the equivalents of our Lane Crawford and Seibu)do not impose credit card surcharges because their goods are so expensive already.We made some large purchases of bedding in David Jones,my brother was called upon to settle those purchases with his miles-earning locally-issued Amex card.

5.The top two supermarkets - Coles and Woolworths (Wellcome and Park'N'Shop equiv)do not impose surcharges.However,a discounted competitor - Aldi (Vanguard?)does - which caused me some surprise in Australia when I saw a school friend pay for an Aldi purchase in cash where I know he has miles-earning Visa and Amex credit cards.

6.Restaurants in five-star hotels do not impose surcharges.Restaurants in Chinatown do (2.5%).This would be the equivalent of our restaurants that take Amex and take Visa/Mastercard only respectively.

7.Tour companies with monopolies (e.g.the only company that can operate ferries to WA's Penguin Island)generally impose surcharges.My sister in law was sick when we arrived at Penguin Island,and attempt to present one credit card after another.I eventually paid for the ferry by cash.

[ 本帖最後由 percysmith 於 2010-10-5 22:54 編輯 ]

All in all,I believe the following will occur when the no-surcharge rule is extended to US and maybe someday,HK:

I.Generally,we'd be using a lot more cash.Maybe the PRC is not so behind after all.

II.Travel-related online merchants will impose surcharges without offering reasonable alternatives - Qantas's behaviour is also replicated by Ryanair.This is scalping tourists and leaving them with a rather bad experience.

III.Instead of having differentiation in which shops offer Amex (high margin merchants)and which offer Visa/MC only (low margin merchants),we'd end up which shops take credit cards without surcharges and which ones collect surcharges.

Finally the big question (which the bank-can-do-no-wrong group in Discuss like to argue)IV - will merchants actually reduce prices if they are allowed to collect surcharges?

The bank-can-do-no-wrong group argued that merchants will impose the surcharges without reducing prices.

Even though I believe that in theory consumers are better off if merchants are allowed avoid non-avoidable cost,I do not trust merchants in HK either.In Australia,the Australia Consumer Competition Commission is empowered to discipline businesses who do not pass on cost savings - we do not such have a Consumer Commission in HK.Merchants will probably just impose credit card surcharges without meaningful reduction in prices.

Also,the people who are capable of reading this thread are net winners under the status quo.We have easy access to credit cards and can get recoup any merchant fees included in the prices of the things we pay by credit card rewards programs.

It is the poor who suffer from having to buy the same items with merchant fee included.This has been called my New York Times as a sort of reverse Robin Hood situation where the (relatively)rich are taxing the poor.

But I still support changing the system.Most importantly because if I have to choose between letting HK banks profit or letting non-bank businesses profit (even big companies),I'd let businesses profit.

I don't believe in reverting to cash.There're costs to managing cash (security services,theft)and public policy issues (both large and small businesses under-reporting taxable income).

EPS-like systems (EPS,EFTPOS in Australia,Unionpay debit in China)seems to be the cheapest method of paying for purchases http://www2.consumer.org. ... nese/app1c.pdf.

But they are aggressively challenged and forced out of the market by the more expensive Visa/MC.This is evidenced by the reducing number of places than I expected allow EFTPOS when the allow Visa/MC.My car rental company didn't (they wanted Visa Debit for no fee,or Visa Credit).Nor did the ferry company.I wonder if the former had an agreement with its bank to steer people to Visa (Debit or Credit),the latter just simply wanted to steer people to cash.