AUTOSHOPS - May dagdag when paying via credit card (surcharge)

[///MPower]

If you want to borrow big, you need collateral and a proven income the is at least 5x youre amortizations.

Or you need good credit, which you can get by using a credit card responsibly, and by paying the bills for said card on time.

Large expenditures for whimsical purchases are just proof of poor money management and an impulsive nature.

Who said whimsical purchases? Just because I've thought through a purchase doesn't mean I want to go to the bank to withdraw cash and then carry all that money to the shop. Conversely, spending with a credit card doesn't necessarily entail frivolous spending. Check your logic.

Likewise, frequent flyer miles are intended to attract the frequent flyers who normally have real reasons for the need to travel and not just a desire to win that free flight. It's not economical for any but the business people who need to fly anyway.

Not so.

The rest of us do so for the rare vacation justly earned and sorely needed.

And if you're flying somewhere on a vacation, you couldn't use a free flight?

The summary can also be called a bill and online purchases are truly attractive but only if the product involved is not locally available, or the local merchants are truly that bad.

It's a matter of convenience. I like being able to check my statements online. I like being able to download them as a file so I can import them into Quicken for my accounts.

What you need to be aware of is that the CC collects 10% or some such for each and every peso you spend with the CC. Merchants cannot absorb so large a cost. That percentage is passed on to you the CC user and is built into the selling price...

This argument is stupid. If the CC companies said today "we are going to offer CC transactions for free" do you think the price of merchandise would suddenly drop? Of course not. Merchants will charge as much a consumer is willing pay.

And because their prices have to be competitive for them to sell, and because there ARE merchants that don't accept CC and that can (supposedly) price their products without the commission, they have to match cash prices for products anyway. And if they can't match the price, then you go to some place that will.

Is capitalism that hard for you to understand?

Besides, if credit cards added such a huge cost to items sold by merchants, why is it that online purchases are generally far cheaper than identical items in brick-and-mortar stores? Overhead for brick-and-mortar stores is much higher than anything a credit card company could incur.

Who do you serve when you report merchants who put a surcharge on CC users? Who benefits?

Me. I, the consumer, benefit.

As I see it, the decree is just the goverment agency making sure the 10% that the CC company earns is hidden from your eyes.

It's not a decree. It's in the contract signed with the CC company. The merchant is, of course, free to not sign the contract and not offer CC transactions.

These people who legitimately need to spend large volume and frequently are few.

Even people that don't spend in high volumes can use credit cards and can use them to their advantage.

I don't like credit cards.

O RLY?

[Pencils]

Or you need good credit, which you can get by using a credit card responsibly, and by paying the bills for said card on time.


Who said whimsical purchases? Just because I've thought through a purchase doesn't mean I want to go to the bank to withdraw cash and then carry all that money to the shop. Conversely, spending with a credit card doesn't necessarily entail frivolous spending. Check your logic.

Get real. The fact that you have to deal with the interruption before purchasing gives you that one final chance to re-think your purchase. All purchases are well thought out decisions until the bill has been paid and you've got the product home.


Not so.

Frequent flyer miles and other brownie points are only earned after a fairly large number of miles or other qualified purchases have been made. Where you be ?


And if you're flying somewhere on a vacation, you couldn't use a free flight?

See above.


It's a matter of convenience. I like being able to check my statements online. I like being able to download them as a file so I can import them into Quicken for my accounts.

For that convenience you pay 10 % of all your purchases. I really need customers like you.


This argument is stupid. If the CC companies said today "we are going to offer CC transactions for free" do you think the price of merchandise would suddenly drop? Of course not. Merchants will charge as much a consumer is willing pay.

Whose the one missing here ? The 10 % was enforced by the CC company and you blame the merchants ? Why not blame the victim for being in front of the bullet. By your logic, the gun weilder is not at fault.

And because their prices have to be competitive for them to sell, and because there ARE merchants that don't accept CC and that can (supposedly) price their products without the commission, they have to match cash prices for products anyway. And if they can't match the price, then you go to some place that will.

That's exactly what I do.

Is capitalism that hard for you to understand?

It's you who has fallen for the song and dance, and gleefully paying 10 % of all your purchases for the music.

Besides, if credit cards added such a huge cost to items sold by merchants, why is it that online purchases are generally far cheaper than identical items in brick-and-mortar stores? Overhead for brick-and-mortar stores is much higher than anything a credit card company could incur.

That's only true if you buy the product and don't include the cost of buying the foreign currency needed, deliver and handling. It's cheaper if you buy at that foreign place, but you still have to get it home. One of these days you really have to learn how to count. Honest. It's good for you.


Me. I, the consumer, benefit.

Describe your benefit. By acting as the CC watchdog you have denied yourself the price difference when all you had to do was go to an ATM which is pretty common with the malls these days. By acting as the CC watchdog you have enforced the CC terms and prices on me and others who know how to count their costs.


It's not a decree. It's in the contract signed with the CC company. The merchant is, of course, free to not sign the contract and not offer CC transactions.

Where's your mind. It's issued by the DTI under the guise of protecting the consumer and you think protecting the CC companies 10 % on all your purchases serves your interest ? In front of you is a goverment agency that is protecting a private interest and you don't see that you are paying the bill for this ?

Even people that don't spend in high volumes can use credit cards and can use them to their advantage.

That's a fact. Congrats. People can use a CC intelligently. When every penny counts, the CC does act as a very convenient source of bridge financing. When your finances are so fragile, you'd best be very intelligent about your purchases as the penalty for error can be a horror. I do however very much object to the CC company having maneuvered the DTI into acting as it's enforcer and active volunteer watchdogs give me a headache.


O RLY?

Getting through to you regardless of all the evidence confronting you is tedious. Please. Try to count.


Pencils

[///MPower]

Get real. The fact that you have to deal with the interruption before purchasing gives you that one final chance to re-think your purchase. All purchases are well thought out decisions until the bill has been paid and you've got the product home.

I've been nice thus far, and haven't said it. I'll say it now, because I'm growing tired of you. You have problems spending wisely. You are unable to manage your credit cards. Just because you make impulse buys because you're unable to regulate yourself, and you need the extra time it takes to go to the bank, doesn't mean anyone else is like that. Don't assume that anyone else has problems being responsible with credit cards because you can't handle it.

Frequent flyer miles and other brownie points are only earned after a fairly large number of miles or other qualified purchases have been made. Where you be ?

How do you know this if you don't have a credit card? I'm not going to come out and say how much I have, but I assure you, I could get a flight to many locations as is. This is from responsible spending, and not from very high volume. Your lack of knowledge in the area is clear.

See above.

Okay. Yeah. Still wrong.

For that convenience you pay 10 % of all your purchases. I really need customers like you.

I'd love to know where 10% comes from. I highly doubt it's that high.

Whose the one missing here ? The 10 % was enforced by the CC company and you blame the merchants ? Why not blame the victim for being in front of the bullet. By your logic, the gun weilder is not at fault.

You missed the point.

That's exactly what I do.

Then stop whining.

It's you who has fallen for the song and dance, and gleefully paying 10 % of all your purchases for the music.

Actually, I shop around, too. I pay the same prices as you do, and I use my card, because most of the time, it's not the sellers who only take cash that offer the lowest price. Tell me who is getting screwed here?

That's only true if you buy the product and don't include the cost of buying the foreign currency needed, deliver and handling. It's cheaper if you buy at that foreign place, but you still have to get it home. One of these days you really have to learn how to count. Honest. It's good for you.

You have no idea what you're talking about.

Where's your mind. It's issued by the DTI under the guise of protecting the consumer and you think protecting the CC companies 10 % on all your purchases serves your interest ? In front of you is a goverment agency that is protecting a private interest and you don't see that you are paying the bill for this ?

That 10 per cent again. Should I really be all suprised that you don't know what DTI stands for? Hint: It's a consumer protection agency.

That's a fact. Congrats. People can use a CC intelligently. When every penny counts, the CC does act as a very convenient source of bridge financing. When your finances are so fragile, you'd best be very intelligent about your purchases as the penalty for error can be a horror. I do however very much object to the CC company having maneuvered the DTI into acting as it's enforcer and active volunteer watchdogs give me a headache.

There are many valid uses beyond that. Mainly not having a ton of cash on you at all times that you can be robbed or pickpocketed of.

Getting through to you regardless of all the evidence confronting you is tedious. Please. Try to count.

Sure. I'm done with this. If you want to continue whining about how credit cards make everything more expensive, fine. Use cash. That you clearly lack the ability to manage funds or understand simple concepts like free markets doesn't really affect me.

I do encourage you to learn a little more about economics, though. There's a reason Toyota makes more money Mercedes, and it has more to do with volume than profit margins. Maybe once you get that, you'll understand why it's in everyone's best interest for credit cards to succeed. And maybe you'll understand how wrong you are.

[mazdamazda]

What you need to be aware of is that the CC collects 10% or some such for each and every peso you spend with the CC. Merchants cannot absorb so large a cost. That percentage is passed on to you the CC user and is built into the selling price. Do you think it won't be there if you don't think about it ? It was certainly very visible when CC's first were introduced but these days the practice has been enforced by patronage and we no longer think about it. Am I so very bad for wanting to preserve my 10 % and looking for the merchants who at least offer me a discounted price for paying in cash ?

Errr... that's just a gross oversimplification of how credit card transaction or the whole retail business works.

For one, the credit card fee is also partially shouldered by the merchants / business simply because it also offers a big convenience to them. For one, this lessens the risk of cash pilferage and/or inventory loss via inside theft for some outlets. They can keep tabs on the daily sales of that outlet remotely and lessens the headache of reconciling the daily sales via the daily bank remmitance of that outlet. All in all - this represents less paperwork and footwork for them.

Second, the purchase of big ticket items like a laptop, furniture, etc. is now possible without exposing yourself to thieves while hauling P100,000 in cash in your handbag or pocket.

Third, as for the "10% surcharge" earned by the CC company or the merchant is peanuts (if it is really 10% gross in the first place) compared to the mark up being originally imposed by the merchant in the first place. Obviously, you aren't exposed to inner workings and financial transactions of any big retail or service business to come to that conclusion.

Lastly, this is discussion is already way off-topic.

[1D4LV]

my take.... kung OT, OT, pero related sa topic.

i am the project manager ng credit card implementation namin dito sa office, wherein, our policyholders (i work in a life insurance company), can pay their premiums via credit card.

yes, OUR COMPANY, shoulders the 10% cost of each premium payment made. bakit namin ginawa ito? as an added service to our clients. hindi namin pinapasa (and i think, established merchants) ang 10% cost sa clients namin.

i believe that is how it is being done.

[userfriendly]

Sorry if a bit OT and long but its related to the topic.

Adding to the customer's bill when paying with a CC is a big no no. Its true that some shops do this. If you encounter one, you can complain to the card company or to the DTI. If I remember correctly, the contract between the merchant and the card company specifically prohibits this.

As to the "10%", it depends on the card company and the business establishment. I used to work for a rtw retailer that was charged 6% by the CC. I also worked for a supermarket, I think the CC got 1% comission. I am now afiliated with a furniture retailer, the CC charges us 3.75% comission. What we do is we absorb the commission, its part of our selling expense. Yes it eats into our profits but a sale is a sale and not a lot of people lug around huge amounts of cash.

The comision is actually fair. Hey the CC has to make money. They advance payment to the retailer. The retailer usually gets paid by the CC the next day. The CC has to wait for the card holder to pay them. We even had one instance where we unknowingly swiped a fake card through the machine and it was approved. The CC paid us but gave us a warning. But hey we did not know it was a fake card and their system approved it. What I'm trying to say here is that retailers actually have less risk with CC than with cash. If we were paid using counterfiet money, then we would have ended up with a loss. Eh diba kahit 5 pesos may fake na.

A CC can be a blessing or a curse. If you know how to use it wisely and pay off your whole bill on the due date, its a very useful tool. However, if you only pay the minimum, you will end up making the card company rich and happy. If your one of these, its better to stick to cash.

Personally, I love my cards, hardly bring cash with me. I take advantage of the promos such as the gas rebate from Caltex and HSBC. Hey I pay the same amount for gas be it cash or credit. Why not get 3% rebate and pay for it in a month or so, may airline miles pa. I also ask them to waive my annual membership charges. Nakakuha pa ng free Timex.

[non-vtec]

also a bit OT but in the travel industry, lugi talaga. I work in a travel agency. The CC Company charges about 5%.

To give you a an idea, lets say a roundtrip ticket fare costs $1000 dollars. plus taxes $234. sa sa fare we get less 7% as commission. so thats about $930 nett plus taxes 234 (not commissionable) = $1164 total nett fare including taxes. then we sell it at $1234 as gross fare. less the 5% CC commission of $61.7. what you have left as profit is $8.3. You can't even add an additional 5% in the ticket to counter the CC commission because the gross fare is indicated there. That would be overcharging. And then the client asks for a discount; he/she might as well shoot me in the head. the surcharge from the CC companies is killing the travel industry.

[BlueBimmer]

somewhat OT but still related

a good example is cement, lets say we sell them * P170, each bag costs P165 (yes, thats how LOW profit margins are in raw construction materials) so thats P5 profit per bag but you have to consider the labor fee of P1 per bag charged by the laborers of the shipping company as transfer fee. so thats P4 of profit, if the CC company charges 5%, that comes to P8.50 per cement bag..

170 - 8.50(CC) - 1(labor) = P160.50

now how in the hell can we as merchants absorb this? we might as well give them away :rofl01:

tapos rereklamo pa bakit walang discount at magpapa FREE DELIVERY pa.

thats why we do not accept CCs with these items, its suicide, magsasara nalang kami at malimos, may kita pa sigurado :bwahaha:

[Pencils]

Hi all.


I'm happy to see such interest. Do allow me to reprise a bit, hopefully to bring it all to perspective. Frankly, I'm also hoping MazdaMazda will not define the discussion as OT. We are, after all, still on the subject of credit cards and surcharges even if the merchants involved are now spread to all rather than just auto shops.

As I stated, the use of the CC requires a 10 % or some such charge usually borne by the consumer. Regardless that a few merchants choose to bear all or a part of the commission, or that some forms of business are charged less and therefore also charge less, the charge is there. As has long been obvious, there are many happy customers of the CC who want to enforce the DTI directive that all be so charged even if they, ( me ), choose to pay cash.

Why do you think it fair to charge me for the commission when I choose not to partake of the service ? The last time I looked, the peso is legal tender and the plastic CC is just an acceptable substitute to specific merchants. In theory this acceptability is not definitive though by the practices you espouse, it will become so. ( In simple, close enough and therefore good ). As I describe it in any case. I'm sure you have other descriptives.

Granted that if the CC were taken away today, most merchants would not drop their prices until competition enforced it. However back sometime in the 70's the merchants who first explored the viability of the CC in it's introductory phase added the 10% or, these days, some such as the nature of the business defines, due to the necessary commission of the CC. You yourself would not take a voluntary pay cut until threatened with replacement. But remember it was the CC that started this whole thing.

Think of the CC as a constant companion to whom you turn for help in paying bills you did not have the cash or a check for. If as your constant companion I charged you 10 % or some such for that help, would you look upon me with the same devotion and loyalty as you do the CC ? If as your constant companion I gave you a graduated system of rewards ( Brownie Points ) for borrowing more to make more purchases, would I still be your friend if you saw me using a small part of your money to pay for the rewards ? Would I still be your bosom buddy if I refused you a reward because you were unable to borrow and spend enough through me ?

Think of a poker game wherein ONE ante is taken for the house with every deal but nobody ever draws more chips and the players are so equal the money just goes back and forth so there are countless deals. Wouldn't that ONE ante eat up all the chips given enough deals ? Does it comfort you to know that when you do a weekly or bi monthly 5,000 peso expenditure for food and groceries, 500 pesos of it goes to the cost of not carrying cash ? For 500 pesos I could be a generous employer of a carpenter to do repairs around my house for a day.

Lets come closer to home. How many of us are paying for a car on credit ? Granted that it's affordable, have you totaled the cost ? I did. I found that under the most comfortable monthly payment schemes, the cost of aquiring ownership of the car doubled. Of course that was more years ago than I care to count. These days I don't look because these days I don't buy a new car until I have the cash to pay for it.

It's simple. Instead of spending my money paying monthly amortizations plus interest and commissions, I put that amount in my bank account until it's large enough to pay for the new car. I get to buy the new car in half the time it would have taken me to pay for it under the friendly and comfortable easy credit plan. You can do the same for a radio, stereo, new tires or car repairs if you just plan you life and expenditures a bit more carefully. And if the CC's hadn't grown to the extent that it was able to make the DTI protect it rather than the consumer, that would be an even easier thing to do. However it's more difficult these days as I'm being made to participate in the expenditure for commissions in almost the same amount that happy CC customers are doing. To make things worse those very same happy CC customers are turning in the few remaining who are trying to break the trend. Would it really be all that difficult for you to go to the ATM in the mall to draw the cash and therefore pay less ? Who are the beneficiaries when you become an active volunteer watchdog for the CC ?

MazdaMazda, I'm pretty sure that before you choose your big ticket item like a laptop, you've already gone through your alternative choices and examined the quality of the purchase. What's so difficult about issueing a check ? If the 100,000 peso big ticket purchase became 90,000 if in cash, would you re-consider the use of the plastic ? But that is not possible if the happy CC customers keep turning in such merchants to the DTI. As you and other happy CC customers have said, it's your free choice. I agree. You can try to keep your 10 % or you can give it to the CC if you are a happy CC customer.

Happy Gilmore,

I'd buy my policies from you if you, instead of happily bearing the 10% commission of the CC, would discount my monthlies 10% instead. I'll pay cash or check, whichever is your pleasure, but not plastic.

Userfriendly,

Clearly the shops that tack on a surcharge for plastic are trying to straddle the fence. Again, the choice is yours to save the difference or to spend it and, in the instant example, force others to also spend it at your choice. It's a condition that the CC and the DTI has wrought. If you think it's fair because everybody gets the same deal, it isn't. By becoming an eager volunteer watchdog, you've taken the choice given you away from others. Therfore they get less. What have you won by doing so ? Fence straddling and violations of contract are not attractive to me. However the CC companies practices and maneuverings to force my participation in the expenditure of commissions is also unattractive to me. A real problem in ethics and practicality.

By my way of looking any commission I pay, regardless of amount, is only fair if I choose to do so because I chose to partake of a service that required it. I feel it's very unfair for me to have to pay for a service I did not partake of.

Granted that a CC can be a blessing or a curse depending on the intelligence of the user. I also take advantage of rebate or discount cards where applicable to my consumption. Some of those restaurant cards are a pretty good deal if you like their food. Chili's for one, though they can be pricey. All money instruments have their uses and where applicable to your specific condition, you should make full use.

Like you I was offered free annual membership though on a pre approved CC that I did not ask for. All I had to do was sign the card and use it. However, habit is also heavy with me and even if I had the card, I continued to patronize the places that I felt more comfortable in. So they charged me 200 per month for every month I did not use their card. They gave up after a few months.

I truly don't like Credit Cards.


Pencils

[mazdamazda]

MazdaMazda, I'm pretty sure that before you choose your big ticket item like a laptop, you've already gone through your alternative choices and examined the quality of the purchase. What's so difficult about issueing a check ? If the 100,000 peso big ticket purchase became 90,000 if in cash, would you re-consider the use of the plastic ? But that is not possible if the happy CC customers keep turning in such merchants to the DTI. As you and other happy CC customers have said, it's your free choice. I agree. You can try to keep your 10 % or you can give it to the CC if you are a happy CC customer.

Issuing a check? That's mean that you have to wait for it to clear before going back to claim your item. That's a big inconvenience to me.

As I've said, your are grossly oversimplifying the "10% credit card surcharge" based on wrong assumptions. You have not even answered my rebuttal that the use of credit cards also means less paperwork and footwork while increasing financial controls for some companies. If you are not exposed to the intricate world of financial accounting then you are grossly misinformed - it is that simple.

Userfriendly already gave a very good example and yet you still ignored it. If you still don't get it, let me reiterate: most merchants choose to absorb the credit card charges as part of the overhead expense. It does not directly translate to an instant 10% increase in the retail price.

====

a good example is cement, lets say we sell them * P170, each bag costs P165

Errr - those are some of items that are not considered to "chargeable" to a credit card. Btw, mahal ang kuha nyo ng semento ha - alam ko ang dealer's price nyan. :bwahaha:

====

The bottomline is that those accepting credit card payments should not add a surcharge. It is that simple.

I regard this already as an off-topic discussion simply because it is already the law that mandates the transparency of the use of cash or charge payments.

If you want to debate about it - go and start a thread. As far as I am concerned, the imposition of surcharges is ILLEGAL. That's final. All other surcharge dicussions will be deleted from hereon.