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Thread: Credit Card Charges

  1. #1
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    Angry Credit Card Charges

    Ever notice how CP quote their prices, stating that it applies only to cash or NETS only payment only. What is wrong with paying with VISA?

    Anyway was at AP around Dec last year. Purchased 2K+ plus of stuff. They wanted to add 3 or 4 % for paying by plastic. Only knew about the additional charge when paying. I let them as I have already agreed on the price and made them absorb GST.

    Supposedly, this charge goes to the bank of credit card company. Perhaps even to cover for the fact that the retailer receives the money up to 2 months later. What is the real reason for this additional charge? Is it fixed? Maybe some of our banker friends can enlighten us.

    Another observation.... when overseas, use of plastic had no restictions. No like here in Singapore, where most places only accept them when charging for more than $20. Many big retailers do no even accept credit cards (NTUC for example, Cold Storage not so sure, last time I checked was a couple of years ago). When I said overseas, across the causeway is included. Was at a supermarket in KL and was pleasantly surprised by that they accept credit cards, and didn't see any signs say that you have to purchase more than a certain amount to use credit card.

    So is this additional charge and restrictions peculiar to Singapore only? Who is making that additional amount? Is it the banks colluding here and charge a high transaction charge? I am sure that there is transaction charge but 3 to 5% is too much! Or retailer parkat and add that charge?

  2. #2

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    From what I know, everytime you pay by plastic, the retailer gotta pay 2% of the total amount to the bank (or straight to VISA/MASTER/AMEX/DINERS/JCB?), that's why they make you pay the additional 2% so that their profit doesn't suffer a "loss".
    CP is more flexible with this rule as they don't charge you any extra if you go straight to the store to get stuff, and sometimes, they'll still honour their e-quotes even if you pay by card.

  3. #3

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    Isn't it good that they add a charge to credit card purchases to discourage you from spending money you don't have?

  4. #4

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    Hi, I did made a complain to my credit card upon knowing that the merchant is charging me 2 to 3% extra... and guess what, the credit card customer officer talk to the merchant, and the merchant bo bian.. in the end I did not pay the 2 to 3% extra lor...

    However I also wonder what is teh profit margin of cameras in AP, CP etc... if their profit margin is more than 2 to 3% they should absorb it even though they have to pay the bank later. If they are unwilling to pay, then they shouldnt accept credit card in the first place...

    Just my two cents..

    TM

  5. #5

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    heard if u pay by credit card and u go back realise the good is faulty u can call the credit card company to stop the transaction before the shop do their daily closing, i guess most shops not so "stupid" to let customers have the chance to reject the goods after purchase.

  6. #6

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    Originally posted by trendmatrix
    However I also wonder what is teh profit margin of cameras in AP, CP etc... if their profit margin is more than 2 to 3% they should absorb it even though they have to pay the bank later. If they are unwilling to pay, then they shouldnt accept credit card in the first place...
    If they don't accept credit cards, then customers will complain that such a big shop doesn't even accept credit cards. Let's face it, customers like to complain, because they think they are always right.

    I looked at the wholesale price of Fuji digicams to retailers before, and if you don't buy in bulk (really BULK), the profit margin is actually very little, considering the price CP and AP are charging. Dispelling the isolated cases when they kotok some carrotheads, most of the time the profit margin is quite narrow. They still got overheads like rental, utilities, manpower to pay for.

    Many larger retailers like Harvey Norman right down to your regularly boutiques earn higher profit margin that's why they can absorb the 2% charge on CC transactions. As for AP/CP, I really don't mind paying that 2% if I really have to pay by CC. I mean, you are paying a price much lower than the MSRP using borrowed money already, why ask for so much? Let people earn their living lor.

    Just my personal opinions, and my facts may be wrong. Feel free to correct me.

  7. #7

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    Folks
    1) Merchants not allowed to surcharge. Merchants will loose their facility if you complain to VISA\MC\Amex directly. Banks are lazy to follow thru the complaint in most cases.
    2) Merchant Service is from 1.3% to 1.5% average.
    3) Merchants are paid for the sales the very next working day, directly into their bank account
    4) Merchants benefit tremendously from this facility as not every Tom, Ang and Ali can afford to pay the full sum and therefore rely on the banks to finance the purchase. If Customer can't pay the bill, it is the bank that looses out and not the merchant. The merchants that really benefit are those that sell expensive and high end goods. No photo store selling high end stuff like Nikon, Canon etc can afford not have this facility. Merchant who have had their facility cancelled literally cry and even plead with the customer to withdraw the complaint.
    5) If merchant insist on charging the card fee, make him separate the charges or walk out. The bank will refund if the card charges are separate in the invoice and will follow up with the merchant's bank.
    regards

  8. #8
    Loke
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    why pay by credit card?

    if u dun have cash, then dun spend!

    simple theory.

  9. #9

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    Personally, I prefer using card for larger sums as that helps in earning points for the card. Moreover, if the sum is >2k, I won't even be able to use NETS. Cash is definitely outta the question. I don't feel comfortable with losta cash in my pocket.

  10. #10
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    D100 $3488 - 1GB Flash $300, you'll need at least 2 nets card to pay them that's why. The longer you hold cash on yourself you gain the interest. That's why people use card.

    I've had people willing to pay 3% on top of the price just to get the card points.

    When you swipe card, there's a GST charge to pay to the card issuer, in this case 4%, but as far as I know the charge fluctuates every month, sometimes it's 2% sometimes 2.5% (I worked sales before so I know)

    So like most of the members already replied, the shops actually "lose" that surchage for cards used. So they charge to you that surchage so they still earn the margin profits.

    A lot of shops does that, try walking around SLS the computer shops everything, they all charge the surcharge, even Memory World at Funan also did when I paid for my 2 CFs using credit card, a surcharge of 3%.

    I would think it's pretty normal as they don't want to shoulder such innocent costs which is deducted from their earnings.

    CP never charged me that extra %, they always give me at the price they quote, never asked cash or nets or card, I bought several stuffs from them this way, I always felt comfortable paying them even though a bit expensive.

    I know AP will charge that surcharge if you pay by card.

    Btw, the use of NETs also has a 1% surcharge.

  11. #11
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    Firstly, CP does not charge me the extra %, but AP does. That said, even after the surcharge, AP was cheaper for my SB-80DX.

    The surcharge by the merchant is dependant on the card. Ask them what the surchage for Diner's vs Mastercard. 4% vs 1.8% the last time I checked. That is a large difference.

    Some merchant feel that if you use a cc, you are rich and can afford the extra surcharge, forgetting that we are eventually getting cashless. If you had to buy the camera like the example given, you have to use 2 or more Nets card. Cash? I don't think $4k of cash is safe. Furthermore, these shops don't take personal cheques unless they know you well. So what to do? Credit cards are the way to go.

    As for the actual surcharging, I remembered years ago, CASE agreed that for certain industry, where the margins are very little, the surcharge can be applied. These are home/consumer electronics, travel and some other stuff.

    As for using CC everywhere overseas, I paid for a stored-value ticket top up using my card of only US$5 in NYC! Now if only our transport system allows that...
    Last edited by Watcher; 7th May 2003 at 08:44 AM.

  12. #12

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    Originally posted by Loke
    why pay by credit card?

    if u dun have cash, then dun spend!

    simple theory.



    CP prices are still cheaper if you pay by cash/nets and bargain

    If your NETs has a $2k limit, then it means you are using DBS/POSB. Other banks have a $3k limit.

    If i was spending above $3k, i would rather get a 2% discount ($60) rather than pay by credit card. I assure you the points you get for your credit card are worth far less than that.

    Yo're also not forced to buy from AP or CP. If you want to use credit card, you can go to Harvey-Norman and get INTEREST FREE instalments as well

  13. #13
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    Originally posted by erwinx



    CP prices are still cheaper if you pay by cash/nets and bargain

    If your NETs has a $2k limit, then it means you are using DBS/POSB. Other banks have a $3k limit.

    If i was spending above $3k, i would rather get a 2% discount ($60) rather than pay by credit card. I assure you the points you get for your credit card are worth far less than that.

    Yo're also not forced to buy from AP or CP. If you want to use credit card, you can go to Harvey-Norman and get INTEREST FREE instalments as well
    Sometimes you have money coming-in in about a month's time and you really want that DSLR now. What is the best way then?

  14. #14
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    Originally posted by erwinx
    Isn't it good that they add a charge to credit card purchases to discourage you from spending money you don't have?

    Anyway it wasn't my intention for this thread to veer into moral and personal financial mangement issues. I was more curious about who makes that extra 4%. Someone here said that banks take 1+% so where does the other 2+% go to?

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    Originally posted by Stoppable
    Sometimes you have money coming-in in about a month's time and you really want that DSLR now. What is the best way then?
    As you said, you just WANT it now. So if you do not NEED it now - no harm waiting rite?

  16. #16
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    Originally posted by erwinx



    CP prices are still cheaper if you pay by cash/nets and bargain


    If your NETs has a $2k limit, then it means you are using DBS/POSB. Other banks have a $3k limit.

    If i was spending above $3k, i would rather get a 2% discount ($60) rather than pay by credit card. I assure you the points you get for your credit card are worth far less than that.

    Yo're also not forced to buy from AP or CP. If you want to use credit card, you can go to Harvey-Norman and get INTEREST FREE instalments as well
    In the case of my SB-80DX, no. CP was still more expensive and was not willing to cut more.

    By right, they are not supposed to put in a surcharge. But with $60, you can take photos immediately vs waiting say for your cash to come in.

    If you plan it correctly, the interest-free period is around 57-58 days. Say for $4-5k, 57 days of interest-free period and reduced stress on your cash-flow, it is worth considering paying $80-100 for it, with you getting the camera immediately.

    One bird (photo) in hand is worth more than two in the bushes.

  17. #17
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    Originally posted by lavenderlilz
    As you said, you just WANT it now. So if you do not NEED it now - no harm waiting rite?
    Yeah right. Most of us have a camera. Do we need another one? The reason to buy another is really because we want not that we really need it. If we live on just what we need we will wait till our current camera breaks down completely before buying another.
    Last edited by Stoppable; 7th May 2003 at 10:12 AM.

  18. #18
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    so maybe i should buy 2 cars, just in case my mum wants to use one or maybe if one breaks down then i can use the other one...... or maybe i should buy 2 houses, just in case one catches fire so i can stay at the other one....... or maybe i should get 2 jobs just in case i lose one job so i got a back up..........

  19. #19
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    Originally posted by NitroTech
    so maybe i should buy 2 cars, just in case my mum wants to use one or maybe if one breaks down then i can use the other one...... or maybe i should buy 2 houses, just in case one catches fire so i can stay at the other one....... or maybe i should get 2 jobs just in case i lose one job so i got a back up..........
    LOL

  20. #20
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    Originally posted by NitroTech
    so maybe i should buy 2 cars, just in case my mum wants to use one or maybe if one breaks down then i can use the other one...... or maybe i should buy 2 houses, just in case one catches fire so i can stay at the other one....... or maybe i should get 2 jobs just in case i lose one job so i got a back up..........
    ??? We don't buy a second camera as a back-up. It is because we want. So if we want a second car, house or wife, go get it, by all means!

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