Tuesday, November 24, 2009

Australians are learning a lessson: Credit cards are a scam...

SYDNEY — When Steve Franklin bought four plane tickets on Qantas last June, he faced an unexpected expense: a surcharge of 7.70 Australian dollars on each of the 136.70 dollar ($126) tickets — just for using his Visa credit card.

Mr. Franklin, who planned to fly his parents and his 7-year-old twin daughters from Sydney to Adelaide, knew that changes to credit card rules had affected the cost of using plastic, but the extra 5.6 percent seemed excessive.

The charges were the consequence of changes in credit card rules in Australia that were aimed, in part, at reducing the cost of hidden fees for using plastic. But the law, passed six years ago, also allowed merchants to tack on new charges, and many have done just that, in some cases with fees that exceed the old ones.
Read the rest here.

Credit cards are a scam and the companies that issue them are crooks. With apologies to New Hampshire my motto is "Live debt free or die."


Tony said...

It is not just the card issuers who are crooks.

In Australia merchants can now charge a fee for allowing you to use a credit card for your purchase. As the article says, the fee is often more than their costs from the bank.

Ironically it is the larger companies, who can best negotiate lower fees for themselves, who often have the highest surcharges.

The airlines offer a discount for purchasing online, but recover a part of that by charging a fee if you use a credit card (which is the only way that they accept payment online).

Anam Cara said...

A credit card company charges to cover the fees involved in the work they do. Yes, the fees may be too high, I won't argue about that. But they do have losses they have to cover, too - I had a credit card that was compromised. Thankfully the only charge was to a retailer in England and not for much money. But we challenged it with the company and they ate the cost and issued a new card number for us.

As long as you use credit responsibly (only charge what you can afford to pay for - pay balance in full each month) there is no harm in it. The credit card company may charge the retailer (who passes the cost on to you) but if you choose a card that gives you cash back, you can generally offset that. We have a card that gives us 5¢ off a gallon of gas, so we use it for all our gas purchases. Another credits us each month with 5% we spend in grocery stores. That's where we use that one.

The key is to learn the rules, the benefits, where to use and they do it wisely. Most people don't want to take the effort to learn all that.

We are rapidly moving to a society where only credit cards will be used as checks are on their way out and most people don't want to carry around the quantities of cash needed for weekly grocery shopping, filling up the car, etc.


Whether you believe the mark of the beast is a credit card or a micro chip (Revelation says it is needed to buy or sell - or even if the common interpretation of Revelation is correct), we are certainly moving in that direction. I work in a Christian bookstore and we often comment on how convenient it would be to have a tattoo rather than muddle through one's purse to find all the stupid little "rewards cards" that give discounts from all the different stores. Let the computer keep track and we won't have to carry as much junk around! It's just a matter of time.....