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Mar 2, 2010
Why impose hefty credit card surcharge?
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CREDIT card companies not only impose extra charges when cardholders use their cards abroad, but also set unfavourable exchange rates. But cardholders face other extra charges as well.
The Jetstar budget airline ticket I booked for a return flight to Kuala Lumpur was a mere $49, but when I wanted to pay with my credit card, there was an additional $12 facilitation fee.
I called Jetstar's 24-hour hotline and was told the additional fee was not imposed by the airline but by OCBC Bank, whose Visa credit card I had used.
The officer told me all credit card companies impose the $12 surcharge, which amounts to almost a quarter of the base cost in my case.
I also made a bulk booking for two other people, for which the total facilitation fee came up to $36 ($12 x 3). Why is it three times the amount when I made a single payment for the three of us?
Credit card charges imposed by retailers are usually 1 per cent to 2 per cent, and 4 per cent at most - not a hefty 25 per cent.
Jetstar should also address this point of high credit card surcharges. If Jetstar and other budget airlines believe in cheap air travel, they should walk the talk and not pass on this extra 25 per cent charge to customers.
Vincent Chan
Why impose hefty credit card surcharge?
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<!-- end left side bar --><!-- story content : start -->
CREDIT card companies not only impose extra charges when cardholders use their cards abroad, but also set unfavourable exchange rates. But cardholders face other extra charges as well.
The Jetstar budget airline ticket I booked for a return flight to Kuala Lumpur was a mere $49, but when I wanted to pay with my credit card, there was an additional $12 facilitation fee.
I called Jetstar's 24-hour hotline and was told the additional fee was not imposed by the airline but by OCBC Bank, whose Visa credit card I had used.
The officer told me all credit card companies impose the $12 surcharge, which amounts to almost a quarter of the base cost in my case.
I also made a bulk booking for two other people, for which the total facilitation fee came up to $36 ($12 x 3). Why is it three times the amount when I made a single payment for the three of us?
Credit card charges imposed by retailers are usually 1 per cent to 2 per cent, and 4 per cent at most - not a hefty 25 per cent.
Jetstar should also address this point of high credit card surcharges. If Jetstar and other budget airlines believe in cheap air travel, they should walk the talk and not pass on this extra 25 per cent charge to customers.
Vincent Chan
