Airlines transparent ‘administration fees’ are a joke
By Darren Cronian on Saturday, January 14th, 2012

Earlier this morning I read on Europe a la Carte that EasyJet has ditched its free fee payment option for passengers using the Visa Electron card and now charges £9 administration fee for all debit cards payments. What has annoyed me though is that this move is supposedly to improve the transparency of surcharges for payment by debit or credit card.

Airlines transparent administration fees are a joke

More transparency for airline admin charges

According the Guardian, a spokesperson at EasyJet, was quoted as saying that the change is to adhere to the legislation that will come into force in 2014 under the Consumer Rights Directive, where holiday companies and airlines have to be more transparent with add-on charges.

No such thing as transparency with airlines

I don’t know about you, but charging a £9 ‘administration fee’ is anything but transparent. Banks charge between £0.20 and £0.80 per transaction for payments by debit card, so what makes up the rest of this ridiculous fee? Surely this is not fair trading?

Imagine what impact it would have on the economy if every business charged us £9 to book a service or purchase a product online by debit card?

Ban on excessive surcharges on bank cards

From the end of the year, the government is putting new legislation in place to ban excessive surcharges on credit and debit cards.

All that will happen is the airlines will change the name of the extra charge from ‘booking fee’ to ‘administration fee’ so that consumers do not associate this fee with payment debit and credit card charges by the banks.

New legislations cost consumers money

It is important that these airline fees are transparent but why is it that every time the government or European Union announces a new legislation, the airlines find somewhere around it, which ultimately costs the consumer money?


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8 responses to “Airlines transparent ‘administration fees’ are a joke”

Pingback - Taking off Travel blog | 16 January, 2012 at 12:29 pm

[...] the US that we have a problem with ever increasing air travel fees. Saturday’s post on the Travel Rants blog saw Darren Cronian talking about administration fees on EasyJet, one of the UK’s low cost [...]

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Robert | 18 January, 2012 at 1:26 pm

This is seriously flawed when you imagine any service paid for online charging such numbers. cards might as well become obsolete. The justification for these fees are wanting and easy jet should withdraw them pronto.

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Nick | 26 January, 2012 at 12:31 pm

Darren

I would love for a debit card to cost me 20-80p per transaction but it does not. Closer to £3 per transaction.

Debit card charges break down as follows
Transaction fee 20-80p
Merchant Fee (the charge for the bank to providing the service).
Gateway fee. (use of the computer system)

And the big one charge back costs, these can breakdown to anywhere from 10p to £10 a transaction. Taking a card of the internet means the charge back costs are likely to be higher. So the real cost is charge backs. What is a charge back? It is where a customer refutes the transaction, be it because of fraud or another reason. This more than anything makes these charges so high.

With easyjet I would guess there paying around 40p in charges and around £6 -£7 in charge back budget.

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Nick | 27 January, 2012 at 1:59 pm

Darren

You ask “so what makes up the rest of this ridiculous fee?”

This is a guess but I would suggest a mix of merchant charges, system fees (to the banks) and charge backs. If Easyjet etc. budget there charge backs into there fee then this would explain it.

*Charge back is where the card holder disputes the transaction and the banks automatically take the money back from the original company. It is then down to the company to prove that the card holder really made the transaction. (Having the card details, address, inside leg measurement etc. is not enough, so it is virtually impossible to prove).

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Chrissy | 29 January, 2012 at 1:52 am

EasyJet is one of the worst airlines for fees and ridiculous charges. If I can avoid them, I will at all cost.

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Catherine | 7 February, 2012 at 12:17 pm

Airlines should not be allowed to advertise lead in prices that are unattainable due to the compulsory charges you encounter through the booking process. Travelers would have a great deal more respect for an airline if they advertised the price including the charges, rather than trying to hide them.

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Kevin | 8 February, 2012 at 9:58 pm

Yes, it seems that airlines are one of the few businesses that get away with just slapping on wacky surcharges. They just make up a new name for it when they want to charge more so you think their tickets are still reasonable.

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Rob | 13 February, 2012 at 11:38 am

To be fair to Easyjet they aren’t the only airline that make up these extras. They all do it because the airlines are struggling to make money from basic seat prices. They need to think differently though and look at services consumers want and would pay for.

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