CC | Surcharges ( Alam mo bang bawal ito?)

pinoy_surfer

some if not most merchants charge extra 5% - 10% when using Credit Card instead of cash, but do you know that this is illegal? You can actually report these merchants to the CC company.

Can anyone ( especially working for CC companies ) verify this?

zimdude

baka naman the credit card companies don't pay the merchants on time?

KuyaDanny

I don't know if that is illegal, but that is definitely against the merchant agreement.

If you are brave enough to try it, the recommended procedure is this:

1) Get the merchant to declare the surcharge separately on the invoice.
2) Charge the whole amount (purchase and surcharge) to your card.
3) Submit the charge slip and invoice to your credit card company. They should refund your surcharge and terminate the agreement with the merchant.

Many merchants know this already, so they resort to another tactic, which is publishing the charge price, and giving a discount for cash purchases. That is different, and will not get them in trouble with the credit card companies.

the_BuGs

Ang pagka-alam ko illegal eh.....


Kasi me nareklamo na sa ganito eh.... tanong lang naman eh bakit nag cha-charge ng 5% sa mga customers nila pag card ang gamit???? eh kasalan ba ng Customer kung nde nagbabayad ng maaga ang mga Credit Card Companies??? at isa pa ayaw kong magdala ng CASH eh... kaya ka nga nag Credit Card eh para iwas sa laman ng bulsa..... kumikita lang ng malaki ang mga merchants dito... isa sa mga pinakamalaking raket to!

KuyaDanny

The reasoning goes this way:

Normally, the credit card company makes a commission on the sale. That's the 5% being talked about above. So when you buy P1,000 worth of goods and put the charge on your card, only P950 goes to the merchant and the credit card company keeps the P50.

If everything went according to plan the merchant should absorb this P50 as a cost of doing business. That's what most people do in the United States, for example.

But here, some merchants want to protect their margins and want to pass on the commission to the customer. They do it by the surcharge method which, as I have said earlier, violates the merchant agreement between the storeowner and the card company.

It doesn't have anything to do with the credit card companies being slow in paying - they usually pay within 5 days of presentation of the bills.

KuyaDanny

I am now advised that such practices may constitute "selling at a price higher than indicated on the price tag, and with discrimination to some buyers" and therefore may violate Article 81 of RA 7394.

nailbiter

yes, i heard violation daw yan ng price tag law. but what about price tags that show both a cash and a card price? and what if walang price tag? halimbawa, in one computer shop i went to, they have a price list na computer print-out at nandon lang sa kahera, don nila tinitingnan ang price. palagi raw kasi silang nagbabago ng presyo because they base it on the dollar exchange rate. dalawa ang presyong naka-indicate sa price list, cash at card price.

KuyaDanny

As far as I know, two prices on the tag are OK. That is clear labeling and you kinow exactly how much you'll be paying.

Sometimes a price tag is not practical, such as when the goods are too small or too large, in which case a price list or a sign near the merchandise is a suggested alternative.

jokertweety

i once have a foreigner client and he used his credit card somewhere in crossing (a mall i think), then the next time we met he was quite furious. he said that in other countries, they dont charge extra for services, only in the philippines. he talked with the manager, and ended up not buying from that store. i didnt quite undestand what he was talking coz i dont use a credit card, and my friends who use seemed not aware of this. tsk tsk tsk akala nila pag may cc mayaman na kaya pwedeng gatasan. i think what we need is awareness, para tigil na ng mga buwayang yan ang pagnanakaw nila. tsk tsk tsk. plano ko pa naman kumuha cc.

nailbiter

Originally posted by KuyaDanny
As far as I know, two prices on the tag are OK. That is clear labeling and you kinow exactly how much you'll be paying.

Given that it might not be a violation of the price tag law, wouldn't it still be against the merchant agreement that you mentioned? Or should publishing two rates automatically imply that the cash price is the supposed "discounted" price?

KD, have you personally tried the recommended procedure that you ran down for us? Na-refund ka na ba ng credit card company for these surcharges?

simurgh

Originally posted by KuyaDanny
I don't know if that is illegal, but that is definitely against the merchant agreement.

If you are brave enough to try it, the recommended procedure is this:

1) Get the merchant to declare the surcharge separately on the invoice.
2) Charge the whole amount (purchase and surcharge) to your card.
3) Submit the charge slip and invoice to your credit card company. They should refund your surcharge and terminate the agreement with the merchant.

Many merchants know this already, so they resort to another tactic, which is publishing the charge price, and giving a discount for cash purchases. That is different, and will not get them in trouble with the credit card companies.

im buying a celfon this weekend. and nagtanong-tanong ako, sabi nung stores na baka bilhan ko, may 6% na patong nga kung charge. and mga 800-1000, din yung patong.

how will my credit card (CITIBANK) know if it's surcharge? do i personally give them the charge slip and invoice? in the case of citibank, where do i go to do this?

so aside from the receipt that i usually get if i charge it to my credit card, i still have to get an invoice with a breakdown of the purchase and surcharge? then this is what i give to CITIBANK?


Sorry kung madaming tanong, nanghihinayang kse din ako sa 1000 pesos... and this weekend na ko bibili. and i'm willing to try you advice.

KuyaDanny

Re procedure:

This procedure is based on the advice of one credit card issuer (BPI). I have never seen it work for me because when I once tried it, the merchant (politely) refused to sell anything to me. Draw your conclusions from those actions, if you wish.

Again, the objective is to get the merchant to state (in writing) that the surcharge is separate and added to the basic price. That's what the credit card issuer needs to go after the merchant.

Ice Burn

Now I know exactly what to do to the dogshop I buy from. I mean even if I only get a surcharge of P50 for a P1000 dogfood, what they are doing pala is illegal, something should be done about it to stop this unscrupulousness.

pinoy_surfer

CC companies actually make a killing out of this surcharges, especially big ticket items ( appliances, furnitures, etc ) , 5% of PhP 10,000 is PhP 500 and if they have CC transactions of 10 units each at PhP 10K a day they already have PhP 5,000 additional revenue that day, doing the illegal way, sadly i think some if not most CC companies has a blind eye on this, maybe afraid of losing many merchants if they implement this strictly, I only use my CC if the merchant don't add these surcharges,

rachelt12

magandang business to a! joke.

this surcharge is actuallly VERY common pagmay-sale. ex: last night, i went to RP sa 9west store. they had a really good sale of 50% of sa shoes that i was going to buy. then, i asked, ilang discount pagcard- 45%.

or pagsa GH naman, when you want to buy ink cartridges, ma 7% (!!!) additional for using a card. once, i said, bawal yan ah. NR lng naman yung sales person.

dapat magkaruon ng consumer awareness dito. (like sa reporting of abusive taxi drivers-- call the 7890!) kasi rampant na pandaraya talaga, to the extent na bihira na yung mga store na di naglalagay ng surcharge!

floreno

Siguro the best way to resolve this issue is to ask
any DTI Officials to determine whether this charges were
Leagal or Illegal.

Very common kasi to when purchasing Cellphones, Computers and Accessories, especially in Greenhills. Most of these items
, when purchased thu Credit cards give you an additional 6.0 - 6.5 % surcharge.

contentdev

( rachelt12 ) magandang business to a! joke.

this surcharge is actuallly VERY common pagmay-sale. ex: last night, i went to RP sa 9west store. they had a really good sale of 50% of sa shoes that i was going to buy. then, i asked, ilang discount pagcard- 45%.

or pagsa GH naman, when you want to buy ink cartridges, ma 7% (!!!) additional for using a card. once, i said, bawal yan ah. NR lng naman yung sales person.

dapat magkaruon ng consumer awareness dito. (like sa reporting of abusive taxi drivers-- call the 7890!) kasi rampant na pandaraya talaga, to the extent na bihira na yung mga store na di naglalagay ng surcharge

sorry off topic



hi rachelt12. just got your private message to me about your hr application. tried to reply but you have no email or private message indicated in your profile. if you need assistance, send email to [email protected] and include your problem so we know its you.

cheers...

simurgh

Originally posted by KuyaDanny
Re procedure:

This procedure is based on the advice of one credit card issuer (BPI). I have never seen it work for me because when I once tried it, the merchant (politely) refused to sell anything to me. Draw your conclusions from those actions, if you wish.

Again, the objective is to get the merchant to state (in writing) that the surcharge is separate and added to the basic price. That's what the credit card issuer needs to go after the merchant.

you're right, the objective is to have the merchant state it in writing!!!


i bough an 8250 phone 2 weekends ago.. and i tried to logically explain to the saleslady why i need to have 2 separate invoices, pero ayaw niya tlga..

hindi daw nila ginagawa un. 1 bill lagn daw tlga!.. i guess, na-inform na din siya ng kung sino man, about the whole issue...

so wla din ako nagawa!

nakakainis tlga yang mga tindahan na yan! :bash:

jtan

just curious.. how do credit card companies in abroad (outside philippines) earn money? through commissions din ba? and if merchants in abroad don't have surcharges, why are they still motivated to use credit cards?

KuyaDanny

Credit card issuers abroad earn commissions from merchants, too. Merchants are motivated to use credit cards because they believe accepting credit cards increase their sales.

KuyaDanny

Being able to accept credit cards also enables merchants to take orders and "payment" over the phone, by fax, and internet. It also saves them time going to the bank to deposit their cash, and reduces the cash level in the cash registers. The less cash in the registers, the less cash dishonest employees, or criminals, can steal.