Could you save yourself money on flights?
Travelling can be an exciting experience, but what isn’t exciting is the amount of money it actually takes to fly to your destination of choice. Flights can be one of the most expensive parts of your trip, and so it’s a good idea to do all you can to reduce these costs.
Credit card surcharges are often one of the ‘forgotten’ costs of booking flights. Some airlines and travel agencies charge surcharges as high as $30 per passenger, so if you are booking for a family or group the costs can really add up. Read our guide on what you can expect with credit card surcharges on flights, and how you can avoid them.
What is a credit card surcharge?
In 2003, the Reserve Bank of Australia (RBA) put in new reforms that allowed retailers to charge customers who use a credit or debit card to make a purchase. These surcharges were designed to cover to reasonable cost that would be incurred by the retailer for offering credit card payment services.
Unfortunately, some retailers started charging unreasonably high surcharges. The RBA then introduced reforms in March of 2013 that aimed at limiting the amount retailers can surcharge when customers use a credit or debit card.
While credit card surcharges are meant to help retailers be able to afford to offer card payment options, some merchants charge fees that go beyond covering the cost of accepting credit cards. Airlines are among the worst offenders for charging high surcharges, but there are ways to avoid these fees.
What surcharge can I be charged for flights?
Different airlines and travel agencies will charge varying surcharges for booking flights. Here are some of the fees you can expect:
- Booking with the airline
- Virgin Australia - You will be charged a Booking and Service fee that is $7.70 for domestic flights or for between $10 and $30 for international flights, per booking per person when you pay with a credit card, PayPal or Debit Card.
- Qantas - You will be charged a booking fee of $7 per person per booking for domestic and trans-Tasman flights, and a $30 fee for international flights when you pay with a credit card. If you pay with a debit card or Qantas cash, you will be charged $2.50 for domestic and trans-Tasman flights, and $10 for international.
- Jetstar - You will be charged a Booking and Service fee of $8.50 per passenger per domestic fare and $8.50-$12.50 per passenger per international fare.
- Tigerair - You will be charged a non-refundable Booking and Service fee of $8.50 per person per flight.
- Booking with a travel agent
- Flight Centre - You will be charged 1.98% for Visa and MasterCard, 2.97% for American Express, 3% for Diner’s Club and 1.98% for PayPal.
- Harvey World Travel - You will be charged 2% for Visa and MasterCard and 2.8% for American Express and Diner’s Club.
- Booking with online travel sites
- Webjet - You will not be charged credit card surcharge fees when you book with Webjet, rather, all booking costs are built into the fair.
- Expedia - Their website states that you will not pay any sort of booking fees, although you may be charged credit card fees by certain airlines, and this will be applied after selecting your fare.
How to avoid credit card surcharges on flights
Now you understand a bit more about credit card surcharges and when you will be charged them, take a look at some of the ways you can avoid them:
- POLi - You can use this payment when booking through airlines such as Virgin, Qantas or Jetstar. You can also use it for some betting sites. The system basically lets you transfer your funds directly to the airline from your bank account and therefore avoid surcharge fees.The option to pay with POLi usually comes towards the end of the payment process when you book with airlines. You simply select your bank and then login using internet banking. Then you can transfer your funds as you would any other transfer, and the ‘To’ account will already be filled out with the POLi details.
- Jetstar - Jetstar offers you a couple of ways to avoid paying the Booking and Service fee when paying for flights online. If you pay in Australian dollars (AUD), Jetstar will waive the fee if you pay using a Jetstar MasterCard, Jetstar Platinum MasterCard, Jetstar Vouchers, POLi and Direct Deposit. If you use the a Mastercard Debit Card on their app or mobile site you can also avoid paying any surcharge.
- Tigerair - The $8.50 Booking and Service fee does not apply to bookings made for a Tigerair flight with an Australian-issued debit MasterCard.
- Use a different card - As you can see with some of the fees outlined for different airlines above, you will be charged varying surcharges depending on the card you choose to pay with. Generally, an American Express card has higher surcharges because they are more expensive to process. MasterCard and Visa cards usually come with the same surcharge, although this may differ between merchants. Check what you will be charged before you pay for your flights to make sure you are charged the lowest fees possible.