Westpac credit charge surcharge for paying a speeding fine - can't the Govt get better banking deals?

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Forums › Finance and wealth management › Westpac credit charge surcharge for paying a speeding fine - can't the Govt get better banking deals?

lchiu7

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#134054 13-Nov-2013 09:22

Just a beef. I was paying a friend's (not mine!) speeding fine and used the NZ Police web site. The CC payment is handled by Westpac who imposed a 3% convenience charge. The Police site painstaking notes that they do not receive any part of this commission.

You would think that the Government, with all the business it has with Westpac, would have been able to negotiate fee free credit card charges for Police fines. I seem to recall recently having renewed my car registration online, that there were no CC charges.

It's not even consistent across the various departments.

Given the amount of the Government banking business, I hope they put the contract out for tender and get better deals. Westpac has had it too long.

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#931907 13-Nov-2013 09:46

I can see why it is imposed but let's face it - why make it harder than it is to pay a fine when it is hardly "cost recovery"?

Fred99

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#933036 13-Nov-2013 12:34

There's probably some statutory reason why a CC fee can't be "absorbed" in to the cost of fines. I doubt even government can negotiate zero CC fees.

CYaBro

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#933053 13-Nov-2013 12:55

Why aren't they using Kiwibank or one of the other NZ owned banks?

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ahmad

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#933055 13-Nov-2013 12:56

Kiwibank and the others won't have the capacity to take on the job at a guess. Also they have been with Westpac forever. Since when does anyone know?

Bung

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#933077 13-Nov-2013 13:21

"After a recent review of Australian credit card surcharges, the Reserve Bank of Australia has now
given credit card companies the power to limit what retailers charge customers. The credit card fees
must reflect the true cost of providing the service. As an early response to this new power, Visa
Australia has restricted surcharges to as little as 1%. "

Westpac treating NZ as a profit centre.

lchiu7

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#933080 13-Nov-2013 13:27

I heard a while ago in the news that English was thinking of putting the account out to tender. Kiwibank was mentioned buyt they themselves said they did not have the capabilities to manage it.

And if LTSA don't charge CC fees for licence renewal why do the Police charge (or Westpa charge the Police?)

Staying in Wellington. Check out my AirBnB in the Wellington CBD. https://www.airbnb.co.nz/h/wellycbd PM me and mention GZ to get a 15% discount and no AirBnB charges.

kingjj

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#933081 13-Nov-2013 13:29

Doesn't the entire NZ Government bank with Westpac? And isn't there some All of Government initiative which means all Government Departments must use the same suppliers to get cost Savings? I do seem to remember reading recently that the Government was putting their banking out to tender (or had just put their banking out to tender - can't remember which way) and that Westpac were the prime candidate. Now to find source...

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mattwnz

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#933083 13-Nov-2013 13:31

Personally I think retailers shouldn't be able to charge an extra surcharge for cc payments. The ACC also charges a similar percentage. If they do, it should be fixed to a maximum like 1%.
If they want to offer credit cards, it should be a payment that they accept without fee, and the cost is part of the operating expenses. Credit card companies don't like their retailers charging the fee either, as it doesn't look good for credit card payments to be treated differently.
If the customer pays cash, cash costs to handle, and some banks now have a cash handling fee when dealing with lots of coins, so there are costs with managing cash too.

Batman

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#933087 13-Nov-2013 13:38

Bung: "After a recent review of Australian credit card surcharges, the Reserve Bank of Australia has now
given credit card companies the power to limit what retailers charge customers. The credit card fees
must reflect the true cost of providing the service. As an early response to this new power, Visa
Australia has restricted surcharges to as little as 1%. "

Westpac treating NZ as a profit centre.

I don't know the exact surcharge but i doubt it is as high as 3%.

having said that, if the police isn't pocketing the 3% ... then westpac must be! 3% is a lot!

kingjj

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#933090 13-Nov-2013 13:44

lchiu7: I heard a while ago in the news that English was thinking of putting the account out to tender. Kiwibank was mentioned buyt they themselves said they did not have the capabilities to manage it.

And if LTSA don't charge CC fees for licence renewal why do the Police charge (or Westpa charge the Police?)

Probably because the NZTA (they have't been the LTSA for years) have the cost of processing built into their fees. If you renew at a NZ Post shop then the NZTA has to pay them a fee to handle the transaction. Most NZ Post shops won't let you pay renewal fees on CC's due to the cost involved.

mattwnz

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#933092 13-Nov-2013 13:47

joker97:
Bung: "After a recent review of Australian credit card surcharges, the Reserve Bank of Australia has now
given credit card companies the power to limit what retailers charge customers. The credit card fees
must reflect the true cost of providing the service. As an early response to this new power, Visa
Australia has restricted surcharges to as little as 1%. "

Westpac treating NZ as a profit centre.

I don't know the exact surcharge but i doubt it is as high as 3%.

having said that, if the police isn't pocketing the 3% ... then westpac must be! 3% is a lot!

A small retailer may get charged as much as that, but for businesses processing vast volumes of transactions, the fee should be a lot less. But maybe they are also using it to pay for things like the website processing infrastructure, and staff to manage it.

Byrned

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#933093 13-Nov-2013 13:48

CYaBro: Why aren't they using Kiwibank or one of the other NZ owned banks?

It's all about infrastructure. Kiwibank have already stated that even though they would like some of the business, they don't have the necessary infrastructure to deal with it all. http://www.stuff.co.nz/business/industries/8825146/Kiwibank-not-after-Govt-business And if Kiwibank don't have the infrastructure, then TSB or the other NZ players won't either.

Handsomedan

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#933121 13-Nov-2013 14:30

Bung: "After a recent review of Australian credit card surcharges, the Reserve Bank of Australia has now
given credit card companies the power to limit what retailers charge customers. The credit card fees
must reflect the true cost of providing the service. As an early response to this new power, Visa
Australia has restricted surcharges to as little as 1%. "

Westpac treating NZ as a profit centre.

How is that even relevant?

The RBA has absolutely no sway in NZ.

In case you hadn't noticed NZ and AU are completely different copuntries operating completely different ecoonomies.

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nate

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#933178 13-Nov-2013 14:53

Why should they ask for a better deal? It's not like they are having to cover the surcharge.

CYaBro

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#933375 13-Nov-2013 17:49

mattwnz: Personally I think retailers shouldn't be able to charge an extra surcharge for cc payments. The ACC also charges a similar percentage. If they do, it should be fixed to a maximum like 1%.
If they want to offer credit cards, it should be a payment that they accept without fee, and the cost is part of the operating expenses. Credit card companies don't like their retailers charging the fee either, as it doesn't look good for credit card payments to be treated differently.
If the customer pays cash, cash costs to handle, and some banks now have a cash handling fee when dealing with lots of coins, so there are costs with managing cash too.

Personally I think if you want to use a credit card then all charges should be on you and not the retailer.

Opinions are my own and not the views of my employer.

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