Global Travel Media » Blog Archive » Qantas switches from fees to percentages on credit cards

Home » Headline News » Currently Reading:

Qantas switches from fees to percentages on credit cards

July 12, 2016 Headline News 1 Comment Email Email

egtmedia59Qantas is switching from charging a fixed fee for bookings paid by credit card to charging a percentage fee, bringing it into line with new rules imposed by the Reserve Bank of Australia.

For most Qantas customers, the new deal will save them money.

Back in May, the Reserve Bank of Australia Payments System Board (PSB) published its Standard which relates to surcharges by merchants when charging customers for the use of a credit or debit card. Surcharges will be deemed excessive where they exceed the permitted cost of acceptance, as defined in the Standard.

The Australian Competition and Consumer Commission will begin enforcing the ban on excessive surcharges for large merchants on 1 September 2016.

The Standard defines a “large merchant” as one that meets at least two of the following requirements: it has a consolidated gross revenue of AUD 25 million or more, the value of its consolidated gross assets is AUD 12.5 million or more, or it employs 50 or more employees. Qantas falls into all of those categories.

Qantas has up till now charged AUD 7 per credit card booking for domestic flights, and AUD 30 per credit card booking for international flights. It will now charge customers using credit cards 1.3% of the booking value. Surcharges for domestic flights will be capped at AUD 11, and surcharges for international flights will be capped at AUD 70.

David Newington, country manager Australia at the business travel payment solutions provider AirPlus International, said several weeks ago that the reforms were “good news for consumers, who can expect a reduction in their travel costs”. That seems to be the case.

An analysis by Angus Kidman at reiterates that for most passengers, the reforms mean lower fees.

“If your domestic (or trans-Tasman) fare is $539 or less, you’ll pay less than the current $7 figure,” Kidman writes. “Above that, you’ll pay more. At $846, the $11 cap kicks in.” For his full article click here.

Internationally, booking any fare under AUD 2309 will be cheaper under the new Qantas scheme. Above that, customers will pay more – so business class bookings and other travel in the pointy end of the aircraft could be affected, although the AUD 70 cap enters the scene at $5385.

To avoid the surcharges, customers may choose to use a debit card (including the Qantas Cash travel card), BPAY (at least seven days in advance) or the POLi bank payment system.

Low-cost carriers like Tigerair and Jetstar, with finer margins than Qantas, now have to work out what they will do to comply with the new regulations.

Written by Peter Needham

Currently there is "1 comment" on this Article:

  1. AgentGerko says:

    Woo hoo! Don’t ask too hard or you might get what you’ve asked for. I have long said the fee charged by airlines for card use is quite appropriate, although I also believe the charge should be absorbed as it once was before the Reserve Bank decided to make things ‘fairer’ and opened the floodgate for credit card surcharges. But in this instance, a few budget travellers who buy the very lowest fares might save as much as $2 on a local ticket whilst business travellers overseas will often pay more than double what they currently do. That sounds fair, doesn’t it, Mr Reserve Bank? Another case of If It Ain’t Already Broken, Let’s Make Damn Sure It Gets Broken.

    Btw your article is incorrect as there is still a fee for using your Debit card, and how on earth do you Bpay at least seven days in advance when most fares require ticketing in 24-72 hours?

Comment on this Article:

Time limit is exhausted. Please reload CAPTCHA.

Platinium Partnership


Elite Partnership Sponsors


Premier Partnership Sponsors


Official Media Event Partner


Global travel media endorses the following travel Publication