Credit card charges by merchants

[Briggsy]

I am going to buy a motorbike. I didn't really want to use the money I have in Thailand. So, I thought I might use a UK credit card I hold which has no charges for non-sterling purchases. It provides excellent value. I have used it in many countries.

 

However Mit Yon Pattaya and many other Thai merchants have a 3% surcharge on credit card transactions (Thai or foreign). On larger purchases, that makes it not worthwhile. I will stick to cash.

 

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added padding for safety.

[NowNow]

17 minutes ago, Briggsy said:

I am going to buy a motorbike. I didn't really want to use the money I have in Thailand. So, I thought I might use a UK credit card I hold which has no charges for non-sterling purchases. It provides excellent value. I have used it in many countries.

 

However Mit Yon Pattaya and many other Thai merchants have a 3% surcharge on credit card transactions (Thai or foreign). On larger purchases, that makes it not worthwhile. I will stick to cash.

 

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added padding for safety.

 

If it's a Halifax Clarity or similar, do over the counter withdrawals at your bank.

[Pattaya57]

1 hour ago, Briggsy said:

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added padding for safety.

This surcharge has been around for as long as I can remember. In Australia your gas, electricity and council rates are all 1.5% higher if paid by credit card (same as airport duty free you would have seen on your way to Thailand)

 

[Briggsy]

2 hours ago, NowNow said:

 

If it's a Halifax Clarity or similar, do over the counter withdrawals at your bank.

Unless you know something I don't this is very dangerous advice.

 

From the Halifax website

"Interest charges will apply from the day you make a cash withdrawal."

 

I will use cash from my SCB a/c for now.

[KannikaP]

Last month I bought a Wave 125 for the Mrs, cash price Bht 59000.

Buy it on credit, 68000 PLUS THE INTEREST..

Wanted to buy it on my Nationwide C Card, no foreign transactions, or my Wise. Nooooo, top price again.

Paid CASH.

[treetops]

6 minutes ago, Briggsy said:

Unless you know something I don't this is very dangerous advice.

 

From the Halifax website

"Interest charges will apply from the day you make a cash withdrawal."

 

I will use cash from my SCB a/c for now.

 

Just pay it off as soon as it hits your account and any interest will be negligible.  Better still get a Barclaycard Rewards credit card and you'll have until the next bill to pay it off.

[NowNow]

33 minutes ago, Briggsy said:

Unless you know something I don't this is very dangerous advice.

 

From the Halifax website

"Interest charges will apply from the day you make a cash withdrawal."

 

I will use cash from my SCB a/c for now.

 

Dangerous? If you have a UK card, you have the means to pay it off. Can transfer same day. No interest.

Some cards don't charge if you pay your statement in full. Okay? Dangerous 😊

[jacko45k]

15 hours ago, Briggsy said:

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added padding for safety.

You answered your own question.... why should they eat the 3% charge. They aren't supposed to but I got a similar hit  on a car service... I was too lazy to go find an ATM in the heat, and of course had no vehicle!

[Jumbo1968]

It was common practice in the U.K. for retailers to charge extra when using a credit card, they said it was a charge from the bank. One of the benefits of being in the EU who outlawed the charge.

[Tropicalevo]

19 hours ago, Briggsy said:

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added padding for safety.

It happens the world over and yes, they are passing on the charges.

They want the selling price in the till.

[SAFETY FIRST]

18 hours ago, Pattaya57 said:

This surcharge has been around for as long as I can remember.

Agree, long as I can remember. 

 

18 hours ago, Pattaya57 said:

In Australia your gas, electricity and council rates are all 1.5% higher if paid by credit card

Wow, I wasn't aware of this. 

 

Long ago when I was living in Australia, I had a GM credit card, I would spend $60000 on my credit card I'd accumulate $3000 off the price of a new car.  

 

I'd buy the wife a new car every 3 years, cheeky me would pay the deposit with credit card. 

 

No charges back then.

[outsidetrader]

20 hours ago, Briggsy said:

I am going to buy a motorbike. I didn't really want to use the money I have in Thailand. So, I thought I might use a UK credit card I hold which has no charges for non-sterling purchases. It provides excellent value. I have used it in many countries.

 

However Mit Yon Pattaya and many other Thai merchants have a 3% surcharge on credit card transactions (Thai or foreign). On larger purchases, that makes it not worthwhile. I will stick to cash.

 

Does anybody know why they apply this surcharge. I assume they are just passing along the fees they have to pay with a little added paddin

 

[outsidetrader]

Indeed it is normal to add 3 % as thats what the bank charges the merchants .Foreighn CCs are the highest with Amex being even higher .So this is normal procedure in Thailand .

[AgMech Cowboy]

20 hours ago, Briggsy said:

I will use cash from my SCB a/c for now.

IMHO, that is the best way to manage the purchase.  I move my money in using WISE.com.  The credit cards can't even come close to the X-rate when converting a Thai purchase to GBP or USD.  (I've got one card out of 3 that doesn't charge an international purchase fee, but I've decide to quit using it. Too expensive).

[NowNow]

13 minutes ago, AgMech Cowboy said:

IMHO, that is the best way to manage the purchase.  I move my money in using WISE.com.  The credit cards can't even come close to the X-rate when converting a Thai purchase to GBP or USD.  (I've got one card out of 3 that doesn't charge an international purchase fee, but I've decide to quit using it. Too expensive).

 

You don't understand what you are talking about. Best to hold back on giving advice since you don't. The right CCs should come in very close to your 'X-rate'

[Jumbo1968]

2 hours ago, NowNow said:

 

You don't understand what you are talking about. Best to hold back on giving advice since you don't. The right CCs should come in very close to your 'X-rate'

My U.K. bank charges a foreign currency transaction fee of 2.99% plus a reduced exchange rate for using a credit card outwith the U.K.

[NowNow]

40 minutes ago, Jumbo1968 said:

My U.K. bank charges a foreign currency transaction fee of 2.99% plus a reduced exchange rate for using a credit card outwith the U.K.

 

Whose fault is that? 😊 Get a proper card and throw that one away if it's no good. Reduced exchange rate seems unlikely. It's usually the Visa/Mastercard rate( often within 0.5% of the mid market rate).

It's somewhat surprising that after years of advice about these thing from the days of ThaiVisa, that there are still people that don't seem to understand how these things work.

[Jumbo1968]

5 hours ago, NowNow said:

 

Whose fault is that? 😊 Get a proper card and throw that one away if it's no good. Reduced exchange rate seems unlikely. It's usually the Visa/Mastercard rate( often within 0.5% of the mid market rate).

It's somewhat surprising that after years of advice about these thing from the days of ThaiVisa, that there are still people that don't seem to understand how these things work.

I did use my CC  years ago through lack of knowledge for foreign currency transactions but have now found other options, I always pay in  sterling, I would never ever use it to withdraw money from an ATM at home or abroad. My U.K. bank has no foreign currency charges if I use my debit card abroad albeit the  ATM here does. I was recently staying in hotel in Scotland, no cash but card transactions only, I could have challenged them but I felt comfortable enough to pay by card.

[digbeth]

some dealers do sell whole bikes on shopping website like Shopee and Lazada, they're mostly in Bangkok, often even with cost of transport plus all the cash(non-finance) surcharge over MSRP local dealers like to put on, this could work out cheaper than going to your local dealer like Mityon who has near monopoly hold on Pattaya area 

[SingAPorn]

It has a risk, but as much as possible, boycott all those credit card crooks. Use cash and that is the best value. With a risk of course but then the odds are higher on getting run over by a reckless driver, then getting robbed in your home or hotel.

[Patong2021]

7 hours ago, Jumbo1968 said:

My U.K. bank charges a foreign currency transaction fee of 2.99% plus a reduced exchange rate for using a credit card outwith the U.K.

My non UK bank does similar.

 

 

6 hours ago, NowNow said:

Whose fault is that? 😊 Get a proper card and throw that one away if it's no good. Reduced exchange rate seems unlikely. It's usually the Visa/Mastercard rate( often within 0.5% of the mid market rate).

It's somewhat surprising that after years of advice about these thing from the days of ThaiVisa, that there are still people that don't seem to understand how these things work.

 

I understand how they work. It is also about benefits and protections. Credit cards have changed how they treat FX transactions and it is your advice that should be updated. You are assuming that  CC usage from a decade ago has remained unchanged and that there is one credit card policy for all  international regions. Alot has changed over the past 5 years. 

Many retailers do not charge fees on CC transactions.  I sometimes pay large bills at Lotus with my Credit Card. There is no additional fee. I pay for some large meal bills with a credit card, and the restaurants I  patronize do not add the CC fee. 

 

Yes, some credit cards  do not have high FX supplemental fees. However, these reduced FX charge CCs typically have annual fees and may not necessarily offer the best benefits or extensions. CC issuers may waive FX fees, but they came up with an alternative method of capturing FX  transaction fees through the annual fees.

 

Another option is to use  DCC terminals. Many credit card terminals are newer versions that use software offering Dynamic Currency Conversion (DCC). This provides the option to make payments in the foreign currency or in the CC issuer's home currency.  It uses a higher exchange rate (ranging from 3-7% higher) than the market rate.  The DCC option allows the CC user to avoid the foreign transaction fee and credit card exchange rate markups mentioned.

 

It all comes down to  knowing how many transactions one will make and in doing a cost benefit analysis. If one has a Thai bank account, and wishes to use a credit card, having a locally issued credit card is almost always the most cost effective method. A person should not make a credit card selection based upon  a small number of purchases.

 

[treetops]

21 hours ago, Patong2021 said:

I understand how they work. <snipped>

 

Your post indicates you are very short in knowledge about how they work.  Better if you stick to supping Chang as your financial advice is on the level of chivas or whatever he's called here.

[Patong2021]

1 hour ago, treetops said:

 

Your post indicates you are very short in knowledge about how they work.  Better if you stick to supping Chang as your financial advice is on the level of chivas or whatever he's called here.

 

Your arrogance is revealing.  Ok, so only you know how credit cards are structured. What exactly was factually incorrect with my statement?   You are quick to dismiss the man for his use of a credit card, calling him ignorant, but you did not offer a viable solution. Instead, you offered a smug statement relying on an outdated credit card format that most financial  institutions have moved away from in favour of fee for service cards.  You completely ignored the need for an understanding of a cumulative costing approach. You also ignored the reality of reward  and cash back cards. What may be lost in FX administrative fees might be partly recouped  in airline FF miles or in full by  the 2-3% annual refund on total transactions that some cards provide. Many people have them now. I do, in addition to my FX credit cards.

[richard_smith237]

Its very normal for Thai vendors to pass on the charges Visa and Mastercard apply. 

 

It doesnt matter if this is a Thai Credit Card or an overseas card (so that point is somewhat moot to the original ops issue).

 

My Wife and I get decent points on our Credit card... and we use the card everywhere and anywhere, whenever possible unless the 3% charge is applied (on top of the 'stated' price)...   the points add to to sufficient air-miles to get a flight for our family each year.

 

With large purchases, 3% is usually applied...  Its a shame, as I think of the amount of Air-miles we could get when buying a car on credit-card and then immedately paying it off - and we've tried, but, nope, they all state a 3% charge when using the card... 

 

Of course, in restaurnts, online purchases and normal day to day stuff most vendors don't charge that 3% (or already write it into the cost).

 

 

[treetops]

12 minutes ago, Patong2021 said:

Your arrogance is revealing.

 

And your ignorance is amazing.  Your previous post was so wrong in almost every aspect but you do as you wish.  Please let others  post about better ways about avoiding credit card fees, getting cashback, avoiding annual fees or scurrilous exchange rates etc for someone like the OP from the UK with the options available to him

[Patong2021]

8 minutes ago, treetops said:

 

And your ignorance is amazing.  Your previous post was so wrong in almost every aspect but you do as you wish.  Please let others  post about better ways about avoiding credit card fees, getting cashback, avoiding annual fees or scurrilous exchange rates etc for someone like the OP from the UK with the options available to him

What was so wrong in every aspect? 

Please do educate me, so that I can speak with our Treasury unit and have the guidance pages updated. Our company credit card policies and guidance for private and corporate use impact 10,000+ people and if our accounting firm has given us improper advice , well, golly gee then I really should say something. You can take delight in pointing out everything that  was so wrong in almost every aspect.

[NowNow]

On 11/2/2024 at 5:25 PM, Patong2021 said:

I understand how they work. It is also about benefits and protections. Credit cards have changed how they treat FX transactions and it is your advice that should be updated. You are assuming that  CC usage from a decade ago has remained unchanged and that there is one credit card policy for all  international regions. Alot has changed over the past 5 years. 

Many retailers do not charge fees on CC transactions.  I sometimes pay large bills at Lotus with my Credit Card. There is no additional fee. I pay for some large meal bills with a credit card, and the restaurants I  patronize do not add the CC fee. 

 

Yes, some credit cards  do not have high FX supplemental fees. However, these reduced FX charge CCs typically have annual fees and may not necessarily offer the best benefits or extensions. CC issuers may waive FX fees, but they came up with an alternative method of capturing FX  transaction fees through the annual fees.

 

Another option is to use  DCC terminals. Many credit card terminals are newer versions that use software offering Dynamic Currency Conversion (DCC). This provides the option to make payments in the foreign currency or in the CC issuer's home currency.  It uses a higher exchange rate (ranging from 3-7% higher) than the market rate.  The DCC option allows the CC user to avoid the foreign transaction fee and credit card exchange rate markups mentioned.

 

It all comes down to  knowing how many transactions one will make and in doing a cost benefit analysis. If one has a Thai bank account, and wishes to use a credit card, having a locally issued credit card is almost always the most cost effective method. A person should not make a credit card selection based upon  a small number of purchases.

 

It appears that you do not understand, at least from what you have written. Please take note of what I actually wrote and to whom I replied.

 

On 11/2/2024 at 10:42 AM, NowNow said:

Get a proper card and throw that one away if it's no good.

 

On 11/2/2024 at 9:57 AM, Jumbo1968 said:

My U.K. bank charges a foreign currency transaction fee of 2.99% plus a reduced exchange rate for using a credit card outwith the U.K.

 

A U.K. card and to obtain one that does not charge that fee.

You changed that to non-U.K. and then stretched the truth with your assumption.

On 11/2/2024 at 5:25 PM, Patong2021 said:

You are assuming that  CC usage from a decade ago has remained unchanged and that there is one credit card policy for all  international regions.

 

I assumed nothing of the sort. You did.

 

 

Furthermore, I see another member has also pointed out that you have jumped to conclusions due to your lack of knowledge of U.K. credit cards. Best you update your knowledge before continuing to embarrass yourself here.

 

I have four CCs in my possession with no forex charges and no annual fees. You obviously have none. So which of us knows how they work?

[georgegeorgia]

On 11/1/2024 at 8:14 PM, Pattaya57 said:

This surcharge has been around for as long as I can remember. In Australia your gas, electricity and council rates are all 1.5% higher if paid by credit card (same as airport duty free you would have seen on your way to Thailand)

 

Oh rubbish, Australia had no such surcharges from Government departments 

You should work for the Government you get free  travel around the World hint hint 

[Pattaya57]

18 minutes ago, georgegeorgia said:

Oh rubbish, Australia had no such surcharges from Government departments 

You should work for the Government you get free  travel around the World hint hint 

You were saying? This is from the government water rates sites

[georgegeorgia]

Oh you don't use Sydney water ?

I forgot your from a Regional area unlike us City dwellers