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Nets Raises Charging Transactions June 5, 2007

Posted by WishBoNe in Emotions & Feelings, Food and Drinks, Random Thoughts, Technology and Gadgets.
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Well, well, well, now then I know that NETS charges 0.3% per transaction. This used to be absorbed by shops. They are increasing the charges to between 0.55% and 1.8%. Some shops are going to pass these charges to the consumer. How thoughtful. Their explanation?

NETS has explained that the increased cost is necessary to make it viable in a market flooded by international debit cards, such as VISA or MasterCard. Card issuing banks prefer to issue international debit card as they receive an Interchange Fee, which is a fee given to card-issuing banks for processing transactions.

Now, we have a GST Offset package, is that why they think that we would be able to afford the increase? We have to buy a lot of things especially food and beverages. So, the package should be enough to cover the increase? No. It won’t. 

The raise will be effective on 1st July. How very thoughtful indeed. We are only informed less than a month to the increase in GST. So, we will be paying 7% GST + 1.8% NETS whenever we buy anything and pay via NETS. Great. Just. Great.

Since NETS is the only official so-called low cost card, it is also the largest organisation that is able to implement such cashless transaction across the country. In addition, it is able increase their cost per transaction to time with the GST increase. Isn’t that business profit thinking?

Why are such transactions are not transparent to the consumers? Was it ever stated in the first place so that we as consumers know that there are underlying costs?

Update: Increase was noted in May by mrbiao. It’s obvious that profiteering is the issue here. Another thing to note is that transactions for Giro especially electric bills, EZLink and other various payments via NETS will be affected. Once in effect, will everyone start to carry large bundles of notes? Will the ATM queue be even longer?

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Comments»

1. - June 5, 2007

It would have to depends on the business owners if they want to pass those charges to the consumers.

I don’t think they would as Nets has become a part of our lifes just like credit cards. They might lost business should they decided to pass the charges to consumers.

If they really did pass the charges to consumers, I’m going to pay cash next time for all my purchases. Why should I use Nets if I’m being charged for using it?

2. WishBoNe - June 5, 2007

Some business owners would be passing the cost to the consumers, not all. It’s just that we won’t know which are the ones who would pass the cost.

Payment via NETS is when the cash on hand is not enough or the cost is, for example, $15.26, in those odd denominators.

3. Ethan - June 5, 2007

Hey, I’m definitely going to walk like 50 m to draw cash from an ATM. It’s totally ridiculous. Why is everything increasing. Should our salary increase as well?

4. WishBoNe - June 5, 2007

@Ethan
Everything that we buy is incresing but our salaries are not in pace because we have to depend on our boss’ apprasial. That apprasial happens once a year.

Although CASE is appealing against the increase, I doubt NETS would withdraw its stand. We have no voice. 😦

5. www.youngupstarts.com » Blog Archive NETS: A CASE Study » - June 5, 2007

[…] You can read the coverage of this news in TODAY. This is also blogged about by Wishbone, […]

6. mr. simplicity - June 5, 2007

A friend told me that everytime they withdraw money from the ATM, $2 is deducted. Is that true too? I didnt realise it cos I always use NETS

7. WishBoNe - June 5, 2007

@mr. simplicity
Every time when withdrawing? I thought the bank charges $2 every month when we have a current account that is for cheques.

8. Triston - June 5, 2007

This is an issue I’ve been working with at the Merchants Payment Coalition. The credit card industry has total control of these fees and a majority of the public is unaware that they pay these to visa and mastercard whether cash or credit is used for payment. The House is holding a credit card hearing this Thursday. I’m hoping interchange is brought up. More information is available at http://www.unfaircreditcardfees.com.

9. WishBoNe - June 6, 2007

@Triston
Isn’t the site deal with USA instead of Singapore?

10. Triston - June 7, 2007

More or less but interchange is a worldwide issue. It still amazes me how information travels across the net. The world really is flat!

11. WishBoNe - June 8, 2007

@Triston
The world is flat online. 😀 Information does travel across the net at amazing speeds.

12. NETS Won Against Case « A Mind of My Own - June 26, 2007

[…] that NETS still won its fee hike. Ridiculous, I say. Competition? True but you don’t just up the transaction fees at this point in time. The GST hike and the ever-rising fuel cost are already costing us major […]

13. Sentosa Girl - July 4, 2007

The queue in the bank is already triple or four times longer everyday! Either the NETs or the bank (or even both) are making everyone (even the banks themselves) more troublesome.

Since NETs is charging extra, everyone will definitely withdrawing all their money out from the bank.

14. WishBoNe - July 4, 2007

@SentosaGirl
Of course. Use cash has benefits too. Some shops even charge less for using cash.

15. mrbiao - July 4, 2007

This is a silent conspiracy – think of it – GST rise, NETS fee rise.

GST rise to 7% causes lots of products to have prices with odd cents. Your regular grocery shopping bill can come up to something like $35.47.

Government stopped issuing 5 cents coins, so if you have no 5 cents coins to pay $35.45 with, or don’t feel like getting back 5 cents change, then you might want to pay with NETS. Many people will think this way.

Then when you pay with NETS, you get charged extra. I haven’t been in SG for the past few weeks so I am not sure, but I heard that some merchants will charge an upfront fee for using NETS.

NETS has made a good business decision to raise fees at this time – it is not about rising costs, it is about improving bottomlines.

Talk about preventing profiteering due to GST raise – NETS has taken the first move already!

16. WishBoNe - July 5, 2007

@mrbiao
There has been conspiracy ever since we have to be “world class” in everything. I don’t want to be in the most expensive place to live in because I won’t be able to afford my own flat! I can’t even afford one now. 😦 Even though cashless seems good at the time, when we think about it and calculate the costs, we are actually spending more silently without being conscious of it.

17. NETS: A CASE Study | Young Upstarts - March 18, 2009

[…] can read the coverage of this news in TODAY. This is also blogged about by Wishbone, Tagged as: CASE, customer service, NETS, price hike, […]


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