I REFER to the letter 'Merchants must absorb charges for transactions' from Mrs Ong-Ang Ai Boon, Director of The Association of Banks of Singapore (my paper, April 30).
Under the Merchant Agreement, merchants are to absorb credit card transaction charges and are not allowed to pass on to consumers or impose any surcharges on consumers.
This is a fair arrangement.
Merchants benefit from additional transactions that might not have taken place if credit card facility is not available.
Moreover, it saves the merchants the hassle of handling cash.
Transaction charges should be factored in as part of business costs.
However, could Mrs Ong-Ang advise on the recourse available if merchants breach the agreement by insisting that consumers bear the credit card transaction charges?
Can the consumers report them to the Association of Banks?
Will the association take action against the merchants and terminate the agreement with them?
For consumers who have no choice but to pay the transaction charges on the spot, can they seek a refund later through the association?
It is a well-known fact that retailers in Sim Lim Square require consumers to pay a 3 per cent surcharge if they use their credit cards to pay for their purchases.
How will the association ensure that these merchants comply with the term of the agreement?
As consumers, we can also exercise our right by boycotting businesses that do not absorb the transaction charges.
