Electronics Store Won't Accept Credit Card for $7500 Purchase (Wants EFT When Item Is in Stock)

LSpIcYChIcKeNCuRrY on 30/11/2017 - 23:58
Last edited 01/12/2017 - 10:08 by 1 other user

So long story short, I placed an order for some new camera gear totalling to about $7500 and opted to pay with my credit card. Mind you, the discount on the camera gear is quite substantial. i'd be very surprised to learn if they would even make a profit on my transaction.

The electronics store, based in Sydney, is a B&M store that has been around for years. I took a look at their reviews on google and seems to be quite 'reputable'.

Anyway - I get an email from them today telling me that:

"Due to the high value, this order exceeds our insurers security limit on card payments and unfortunately we cannot accept the card payment. You’ll note that at this time we have not debited the pre-authorised payment from your account and it remains on a pre-authorisation hold. The pre-authorisation will automatically be cancelled by your bank shortly and will no longer appear as “pending” on your account (that should happen tomorrow or Monday).

For an order of this value we would need to arrange an EFT payment, however at this stage we don’t have stock of these 2 items and are waiting on Sony. We strongly prefer that both items arrive into stock and we are able to immediately ship the order before we request any funds by EFT from you."

My response was:

Thanks for the email.

Is there any way the order amount be split as I feel more secure by using a credit card as my bank provides insurance and buyer’s protection on any items i buy with the credit card?

The other option which I can think of is PayPal which offers a similar level of protection.

And the last response from the retailer is:

Unfortunately deliberately splitting a payment to sneak the total amount under the limit would violate our insurers policy.

Paypal while somewhat more secure than cards also carries security risk for us that becomes quite significant for payments of such a large amount.

We appreciate you may feel that making such a large purchase is a risk, but unfortunately we do need to take great cautions in accepting large payments. If we’re not able to receive a payment by EFT, unfortunately we wouldn’t be able to accept the order.

A few things i dont understand (being someone who has no idea how credit card security works):

  1. What are the "risks" for the retailer besides potential fraud?

  2. Why such a push for EFT? The only reason i can think of is that the retailer would save on credit card/paypal merchant fees - which would eat up all the profit (my guess) from the transaction (yes the camera gear is heavily discounted - A sony A7R III and a sony 100-400 lens).

  3. So every time a customer makes a purchase that runs into thousands of dollars, the retailer would have to email the customer and ask for change of payment option?! come on!!!! seriously. Why would the retailer even advertise the fact that visa cards are accepted in any case then?!

My guess is that point no. 2 is the most likely scenario - where the retailer would make zero profit (or even at a loss).

What are everyone's thoughts?

Financial

Comments

  • jimbobaus on 01/12/2017 - 00:15
    +5

    Sounds to me like they are trying to avoid merchant fees on the transaction

  • PissLUR on 01/12/2017 - 00:25
    +4

    Go to their b&m store and pay on the spot.

  • BuyoTheCat on 01/12/2017 - 00:36

    FE 100-400 camera retail price $3800
    A7R III $4900
    Total $8700

    Most camera stores run on magins of 10-15% before rebates.
    This store is likely selling grey import. Nothing wrong with that. If you are understand the risk of buying imports.

    At the end of the day, I will not be happy to EFT $7500. If I can go into the store and collect the goods. I will give cash.

  • joungs on 01/12/2017 - 01:25
    +1

    Can you buy the camera and lens in a seperate transaction?

  • [Deactivated] on 01/12/2017 - 02:18
    +3

    Fraud, fraud and fraud. Those are the three reasons they're asking for EFT.

    • HeavenlyHammocks on 01/12/2017 - 02:52

      Or they're afraid of the customer committing fraud. It could have happened to them before.

      As somebody mentioned, in stock with cash is the safer option for both parties.

      • [Deactivated] on 01/12/2017 - 04:15
        +2

        So, like I said… Fraud.

  • GetOffMyUnicorn on 01/12/2017 - 02:55
    +1

    EFT would be a giant error. i would give up the ghost and look elsewhere mate.

  • ESEMCE on 01/12/2017 - 08:00
    +1

    Chargeback would be their concern most likely.
    Ditto with Paypal.

    If you trust the store to deliver there should be no issue with EFT. It's no different from handing over cash apart from trusting that they'll ship versus carrying the goods out with you.

  • bobbified on 01/12/2017 - 08:20
    +3

    Due to the high value, this order exceeds our insurers security limit on card payments and unfortunately we cannot accept the card payment.

    Have you tried asking them what their limit is?

    For eg, if the limit is $7000, then pay $7000 on the card and $500 in cash on the spot when you're picking up your goods.

  • stratbargain on 01/12/2017 - 08:49
    +1

    Just tell them you'll wait for Amazon to open up….

  • skinner on 01/12/2017 - 09:36
    +1

    I'd say it's probably chargeback related as well, for that amount I would be concerned too to be honest although you'd think they'd have a better process. Maybe ask if their "insurer" would accept a higher amount if you provide photo ID and a copy of a card statement or similar?

  • dizzle on 01/12/2017 - 09:45
    +1

    It's entirely about fraud protection. Most likely they have been burnt a couple of times and this is the procedure they have in place to stop it happening again. Can you blame them if people keep on trying to rip them off?

    Split payments (on the same card) to slip under the limit will not be protected by the bank if an issue arises. With split payments on different cards they can't tell whether they belong to different people (ie two stolen cards).

    The EFT transfer is secure because they receive all the money before they release the goods. The card holder can't ring their bank and say it's fraudulent after the goods have left the store.

    • joungs on 02/12/2017 - 01:26

      I don't know that much about charge backs but surely people can't just get them done Willey nilley and rip off merchants. Don't you have to convince your bank and provide evidence or something?

      • dizzle on 02/12/2017 - 08:43
        +1

        No, but if someone calls up with a stolen card and you put it through, the card owner reports that it's stolen and the bank withdraws the payment. If you have already sent the goods, the money is gone. I've seen a couple of retailers institute rules like this, and it's often after they have had 2 or three fraudulent transactions losing around $10k a time.

        Is it worth risking again or do you change your procedures to protect yourself?

        • joungs on 02/12/2017 - 10:12

          No way, thats so unfair for retailers, I can see why they would be scared. I thought it would come out of the banks end and their insurance.

        • dizzle on 02/12/2017 - 19:16

          @joungs: The bank only covers it if you can prove you did everything you reasonable can to authenticate it. For example many stores won't ship to PO Boxes and require someone to sign for a shipment, others require you to send through a copy of your drivers license (and won't ship to addresses other than on the license). They often won't let you pay over the phone and have "someone else" pick it up in-store (fraud calls the store and processes with a stolen card, but says their son will pick it up.

          I can understand all these security processes, but the amount of customers that get offended when I ask for a drivers license sent through is amazing. All I can think of is that it's for the card holders protection.

  • berger on 01/12/2017 - 10:51
    +1

    plenty of other places would be happy for the sale of that value

  • SpIcYChIcKeNCuRrY on 01/12/2017 - 20:33
    +3

    Thanks for everyone's opinions and comments. I do understand their concern but the fact that they insisted on EFT makes me wonder the ulterium motive.

    So in the end i told them please cancel the order, as i got digidirect to price match (and they were more than happy to take my credit card).

    • lilkid28 on 01/12/2017 - 23:38

      And earn points on CC.

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