Verizon now demanding surcharges to pay them... [telecom]

Chances are good that that policy is contrary to VZ's agreement with the credit-card companies. _EVERY_ merchant account I've seen expressly forbade "charging extra" for payment by credit-card. Complaints to the card issuer could put VZ at risk of losing the ability to take credit card payment _at_all_. Wonder how they'd like -that-.

CC issuers _really_ don't like it when merchants do things like that.

[Broadband reports]

|FiOS users in our Verizon forums note that Verizon is now |charging users a $3.50 fee if they want to pay their bill |online with a credit card. | -------- |

| |- per the posters, the fee applies if you make a "once off" |payment. If you give VZ access to an autopay process, |they won't charge it.

In this area (Massachusetts) if you set up autopay you must also give up paper bills. I've been making one-off payments for years for just that reason. Every few months they pop up a little box asking me to switch to autopay and paperless billing. I suppose if they implement this surcharge I'll go back to pushing EFT payments from my checking account. (Sending a physical check results in an ACH conversion even if you call the number to opt out.)

Dan Lanciani ddl@danlan.*com

I doubt they would charge if you pay using a major bank's online bill payment service. The bank pays the large vendors via the automated clearing house (ACH, or electronic debit) and small vendors via bank check.

I pay my monthly Verizon cell phone bill by stuffing $20 bills into the automatic bill-paying kiosks in any of their several local stores. Those things are quite popular.

The surcharge is because the credit card companies charge fees to merchants for using their services. With the recent changes in federal credit card rules, expect MANY more retail level merchants, especially gas stations/C-stores, to start doing likewise.

Many gasoline stations in my area charge more for credit card purchases than for cash, sometimes as much as 10c per gallon more. (On a 15 gallon purchase, that comes out to only $1.50.) Presumably that violates such merchant agreements, but none the less a great many stations do so and the higher prices are posted quite prominently.

Probably not, but then you don't get a month's float, the ability to challenge wrong payments, and the various rebates, air miles, and other trinkets that credit cards offer.

R's, John

While that used to be true in the US, the children in the current administration decided they know better and overruled those rules:

The recent consumer protections for credit card users specifically prohibit those provisions in merchant constracts. Wes Leatherock snipped-for-privacy@aol.com snipped-for-privacy@yahoo.com

--- StripMime Report -- processed MIME parts --- multipart/alternative text/plain (text body -- kept) text/html

Do they really care that much? It seems common. Maybe the big merchants get an exception? (Where I am, the electric utility charges ~$4 extra to pay online by cc, though they seem to do it through a link to a different website, whether that's an outside vendor or just a misdirection.)

Dave

I'm not sure that l> Payment networks also can't restrict retailers from offering

It entitles merchants to offer _discounts_ for particular types of payment, but doesn't mention surcharges.

Of course, IANAL and the effect might be different from what it appears.

Dave

Why do people think they have an entitlement to one particular payment method that may be convenient for them personally, but incurs additional costs compared to other methods?

If a company (telephone or whatever) determines that something costs more, then are not they entitled to recover those costs directly from those who incur them? If they don't then it obviously means that other customers of that company are unfairly subsidising them when they pay with lower cost alternatives for exactly the same service/product.

In the ideal world people using the same service would have to pay the exact difference in costs for the various methods of payment but in reality most companies try to hide some of this for the sake of simplicity, but their comes a time in highly competitive industries where this sort of cross-subsidisation isn't sustainable (or appropriate).

I used to work in the retail area and it wasn't really fair to charge cash customers the same as credit card customers - especially when some cards incurred significant extra fees because they were tied to reward schemes where the issuing banks would charge the merchant extra fees to recover these costs.

When you are looking at gross margins of just a few percent, then a Credit Card fee of 1% or so on sales becomes a significant factor in the viability of a business.

-- Regards, David.

David Clayton Melbourne, Victoria, Australia. Knowledge is a measure of how many answers you have, intelligence is a measure of how many questions you have.

Month's float isn't worth the effort these days.

As to wrong payments (charges?) you don't pay the bill by on-line banking if there is a dispute. All the other "goodies" to which you refer do come at a price.

I think the way merchants get around that is by using an outside vendor to process the credit card payment. The fee is paid to the separate vendor, not the merchant.

I still pay my bills by mailing in a check. I don't like the idea of allowing them automatic pay direct from my checking account. While foul-ups are rare, they do happen and I don't want some huge chunk of money taken out until the billing dispute is resolved.

>

Whether it's a surcharge or a discount depends upon your point of view. Assume that an item costs $100 cash and $105 via CC. From one point of view, it's a $5 surcharge for CC. From the other point of view, it's a $5 discount for cash. But the effect on the consumer is the same.

Richard

Generally, the trick is to auto "push" money to the payee (you set up the automatic payment from your end), rather than allowing them to auto "pull" from your account (where you give them your account # and an authorization to debit the account.

When you push from your side, you're fairly safe in case of a screw-up, assuming the bank is reputable.

I just got a letter today from Chase apologizing for a three-day outage of their online bill pay service -- they were offering to pay any late fees charged by payees who did not get payments on time because of this. Where they could, Chase had already automatically waived or credited late fees. They even advised keeping the letter should any late fees show up in the future. I was rather amazed at this level of Customer Service.

Frank

No violation if done right. They can't add a surcharge for using the card, but they're allowed to offer a discount for cash. From the Mastercard merchant agreement (complete with the original pseudo-German capitalization style)

A Merchant must not directly or indirectly require any Cardholder to pay a surcharge or any part of any Merchant discount or contemperanous finance charge in connection with a Transaction. A Merchant may provide a discount to its customers for cash payments.

The paragraph continues with some more info that's relevant to this thread:

A Merchant is permitted to charge a fee (such as a bona fide commission, postage, expedited service or convenience fees, and the like) if the fee is imposed on all like transactions regardless of the form of payment used, or as the Corporation has expressly permitted in writing.

Policy was that you "couldn't charge more" for paying by CC, but you could "give a discount" for paying cash. A semantic difference that affects the way you market things, but 'functionally', no difference.

I only had one payment I would have paid with the service during that period and it was a payment on a Bank of America credit card. I just wrote a check and put in the night depository of the B of A branch a few bblocks down the street. Wes Leatherock snipped-for-privacy@aol.com snipped-for-privacy@yahoo.com

There's a real difference, though: the ADVERTISED PRICE. If the advertised price is $100, it's *not* a cash discount. If it's $105, it is. This probably doesn't make a lot of difference to telcos, but it does to, say, gas stations a few blocks from each other, there's the temptation to lie.

I believe that in other situations, the advertised price has been used to tell whether it's a discount or a surcharge. I'm half-remembering some anti-price-gouging rules that price-capped things (gasoline, food, generators, flashlights, batteries, bottled water, first aid kits, lumber, etc. or maybe it was everything) during disasters (hurricane, flood, tornado, etc.). If you usually charged a surcharge for credit cards, you could continue. A number of businesses tried to cheat and got caught under the advertised price test. This might have been in Houston. I'm not sure about New Orleans after Katrina.

Discount vs. surcharge may make a difference in some states for sales tax calculations.

Telcos, though, usually try hard not to advertise costs (except for cellular service, and then they leave out a lot). I suspect that if telcos thought they could get away with it, they'd charge extra for telling you how much your bill is, and arrange some way for the credit card company put an entry for an unspecified amount charge on your bill. Of course, then you wouldn't get a balance on your credit card bill, either, because that would let you calculate the amount of the phone bill.