Published on Monday, July 24, 2017

Operators furious with misleading claims over 'rip-off' card fees

Tour operators and agents have lambasted the Government for misleading British consumers over 'rip-off' card charges.

The Association of Independent Tour Operators says information given to the British public wrongly accuses travel companies of ripping off customers and of profiteering from the charges.

Operators also accuse the Government of taking the credit for a ban on card fees, which is actually a directive from Europe.

AITO chairman Derek Moore has fiercely criticised a press release issued by the Government about the removal of card fees, saying it had the 'hallmark of tabloid newspapers and not of a responsible Government'.

"How on earth can the Government claim any moral high ground in respect of fairness and transparency when it totally ignores the basic facts?" he said.

Moore argued that the fee existing system is completely transparent and allows consumers to choose the least-costly payment option.

He hit out at claims in the Government press release that all charges levied by the travel industry are a profit centre.

"This is both libellous and incorrect," he said.

"There are few if any companies within the specialist tour operator and independent travel agency sectors that charge a fee of more than 2% to 2.5% for payment made by credit card - and such fees simply recoup the charges made by the banks for handling the transactions.

"The Gov.UK press release totally ignores the fact that it is the banking sector that imposes these charges - not the tour operators and travel agents which are being wrongly criticised."

And he pointed out that the Government is taking credit where credit is not due.

"This is not an initiative of the UK Government; it emanates from the EU in the form of a Directive from Brussels. The UK Government had no part in its inception and cannot claim any such supposed credit."

Moore said a ban on card fees means operators will be forced to increase their prices across the board.

"As we have often told Government, the travel industry works on wafer-thin margins," he said.

"For example, the inability of modestly-sized travel agents, on fixed commission levels, to recoup the 2% to 2.5% card fee charged by the banks could see a 20% reduction in their profitability.

"The Government claims to be helping families with the cost of living but is in fact encouraging our big-business banking industry to lead their customers into debt, which will bring the banks huge monthly interest fee income. This is robbing poor-man Peter to pay fat-cat Paul, to put it mildly.

"If the Government really seeks to lower the cost to the consumer when paying by credit card, then it should address its concerns to the banking sector, and not to honest independent businesses such as AITO's specialist agents and tour operators."

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NHS Dentist charges 12.5% for .Credit Card

My Dentist, part of the Southern Dental Network, charges £2.50 for use of a Credit Card on a basic £20.60 Band 1 charge. By my reckoning that amounts to at least 12%. Extortionate !

By Paul Tucker, Monday, July 31, 2017
Enforced complicity?

We have always passed on any fees, associated with a transaction method, exactly, to the penny. We don't benefit at all by being paid by card so have no reason to encourage (or discourage) it. Actually, considering the theoretical possibility of 'vexatious charge back', card payments, on balance, present an ever so slightly raised risk from our side. Anyway, we believe the customer should have the right to choose whether they wish to 'buy' the benefits of payment by card and we charge no commission/margin/mark-up on those costs: after all, we are not in the business of selling financial services! It is the banks/finance companies who set these charges which are, in effect, a privately operated transaction tax that some people clearly think unreasonable. So, why should we, operators and agents be forced into complicity with this scheme/scam (depending on your view) by having to hide their charges behind a flat pricing policy. It costs us nothing to receive a bank transfer or cheque, so we charge nothing - surely the customer has the right to choose?

By ex Severn, Friday, July 28, 2017
It would be outrageous to suggest ...

@IreneLaird It would be outrageous to suggest that any individuals ever received any kickbacks from these outsourced contracts, but one still wonders.

By Peter Lewis, Monday, July 24, 2017
Credit card fraud is on the increase

& so it can be argued that merchant fees alone aren't enough. Dodgy banks are very quick to issue chargebacks & take no responsibility. No wonder bankers are most hated profession.

By Michael Anderson, Monday, July 24, 2017
Well said Derek

Government 'experts' have never understood how the travel industry works. It's sickening how they pontificate over things they no nothing about and never even consider asking the real experts - the travel industry itself. We only ever charged 2% (credit cards only), to help offset the cost to us from the bank which was around 3.5%, we absorbed the other 1.5%. As Derek says, prices will now have to rise, so the consumer, who the government 'claim' to be helping will just pay more for their holiday. It's not so much The Government - more like Doh Government!

By Keith Standen, Monday, July 24, 2017
We need more travel leaders to repeat this message

When can we expect the leaders of ABTA, Advantage, Global and TTNG to publicly repeat this message?

By Brian Rudd, Monday, July 24, 2017
Got to be Kidding

They cannot claim the moral high ground when they are charging hefty card charges themselves. When I last renewed my car tax earlier this year, the rate to use a card was way over 2.5%. I did comment on their site they were breaking their own regulation, but there was no reply!

By Paul Brewer, Monday, July 24, 2017
THANK YOU!

Talk about double standards from our "Government". Recently, I had to pay them some money and discovered it was an outsourced company in the North of England who charged 3% for a credit card.

By Irene Laird, Monday, July 24, 2017