Hidden Charges in Credit Card Transactions

A compatriot was recently surprised when told that he could ask for waiver of his credit card annual fees.  It never occurred to him to ask.  All these years, and he's been paying for it!  He proceeded to ask for waivers, tracing the fees all the way years back.  Except for one bank (which he is going to cancel out), he managed to get his plea successfully attended to.  It amounted to quite a sum!

We thought everyone knew of this.  Then again, we did once ask a major bank why they wouldn't just make do without imposing an annual fee.  The reply was that a significant number of people simply do not ask for waivers.  Presumably, their ignorance, forgetfulness or generosity comes as a bonus to the credit card issuing bank.  So why should they make waivers a default?

The credit card annual fee, along with the GST, are printed as a separate line on the statement.  It is not a hidden charge, but the credit card holder do have to run through every line of the charge statement to locate it, as is the responsibility of the credit card holder.  There is currently no facility to be alerted of annual fees via SMS or other means.

Things gets murky however, when credit card companies pose a purchase with an amount different from that reflected on the customer's invoice with a merchant.

MICE Ranking encountered this with Zalora and Asos.  Internally, these companies had signed up with some foreign banks to settle their invoices, and instead of absorbing these bank charges as part of their domestic book-keeping procedure, they decided to let the consumers shoulder it - without pre-informing the consumers (at least, during the time of our purchases made last year).  So after the consumer clicks okay to a purchase order amount, they landed up with an add-on administrative charges over and above the invoiced amount.  This is imposed surreptitiously over the credit card statement.  Unless a consumer is eagle-eyed and fastidious, it is easy to miss out the surcharge that has not been agreed to because the credit card statement makes it appear as though a very lousy rate of foreign exchange has been applied.

What alerted us was that in Zalora's case, it was a local currency transaction.  There wasn't even supposed to be a foreign currency exchange involved.  After much hassle, they refunded us.  Nevertheless, this experience really can deter future support of their enterprise because busy people simply dislike hassles.

In Asos' case, they gave all kinds of excuses and push us from personnel to personnel.  Till today, they have not refunded the surcharge that was never listed on any of their pre-purchase agreement sent to us at that time.  They simply hope the consumers give up on their claim by blank-walling tactics.

We have shipped products from USA where any processing or bank charges in percentage or estimates were pre-informed in a standard agreement so that consumers get a fair chance to decide if they still wish to proceed with the purchase.  We've had good experience with Amazon, and so far, most of the major brand-names in USA abide by best practices.

In the name of fair practice, and customer retention - considering how expensive it is to advertise, market and promote a brand name - it is difficult to understand why vendors wish to sabotage themselves by refusing to do the same, and rather land the consumers up with shock and having to go through the inconvenience of pleading for reversals.

For a long time, we've suffered in silence. 

Then more and more complaints pop up in the news and in online media, all sharing similar frustration of having to deal with organizations that are not upfront.



Credit: The Straits Times

All along, we had only been pleading with Asos - to much waste of time and to no avail!

The sharing by affected consumers reminded us that we could have asked the bank to help us settle the surcharge that Asos imposed on us without our agreement.