Store Refunds - Should You Be Getting The Card Transaction Fee Refunded as Well?

meong on 01/10/2023 - 15:25
Last edited 01/10/2023 - 20:29

Hi all,

Not sure if this has been covered before.

I encourage business owners to comment on this as well.

So, I bought something from Centrecom on a Saturday and paid by card. incurring a 1.2% surcharge.

After I got home, i spent few hours trying to get it to work and even searched on forums on the potential of upgrading the firmware to no avail.

On the Sunday I went back to Centrecom and explained (argued) that this was technically a DOA that I'm entitled for a refund.

Centrecom eventually agreed and refunded me however, they could only refund me the price of the product instead of the price + 1.2% surcharge.

The surcharge being only few dollars worth, I decided not to argue further and just left.

The question I'm asking here is:

Is this the norm? That getting a full refund does not entitle you to the refund of the card surcharge?

I went home on Sunday and noticed that the original transaction on Saturday was still "pending" anyway. In my understanding, the transaction could have been reversed and it will just simply "disappear" from my statements meaning the bank will not charge Centrecom the fees anyway?

I may not understand how the banking works in the backend hence I'm happy to be corrected.

Poll Options

  • 15
    Full refund should entitle you refund of the price of item
  • 145
    Full refund should entitle you to reversal of the whole transaction (price + card surcharge)
Financial

Comments

    • meong on 01/10/2023 - 15:32

      A bit of victim blaming isnt it?

      In additiont to that, can you link specific article about this?

      • deme on 01/10/2023 - 15:36
        +1

        Sure: https://www.accc.gov.au/consumers/problem-with-a-product-or-…

        Same thing if you put it in your computer and due to the card being bad, it ruined your computer.

        What's next, ohh we don't refund delivery since it was successful?

        • meong on 01/10/2023 - 15:55
          +2

          I checked the part about this:

          "A refund should be the full amount the consumer paid for the product. The business must not deduct an amount from a refund to take into account the use a consumer has had of the product."

          However, it doesn't clearly say anything about card surcharge fees.

          • deme on 01/10/2023 - 15:57

            @meong: Just ring them on Tuesday then.

            • meong on 01/10/2023 - 16:08
              +1

              @deme: Lodged a case with ACCC anyway

      • ozboygsl on 02/10/2023 - 10:06
        -5

        Wow . So rather than deal with isdue of the guilty party being called out, you attack them…kind of like blaming the victim yourself .
        Grow a pair and deal with the fact that allowing ppl to rip you off ( either because your too lazy or to weak) only encourages them to do it more.

  • AustriaBargain on 01/10/2023 - 15:29
    +1

    The merchant won't get refunded the card fee. They won't get charged the fee again when refunding though. I think as a cost of doing business they should refund you the total amount. It's the reason retail costs so much more than wholesale imo.

    • deme on 01/10/2023 - 15:36
      -1

      Merchant should have sold a card that was working.

      • AustriaBargain on 01/10/2023 - 15:38
        +1

        Yes, if refunding it's probably because the customer didn't get what they wanted in the first place. Merchant should cover that. And the fringe cases of change of mind they should eat the costs. It'll probably pay for itself if it results in loyal customers anyway.

    • apsilon on 01/10/2023 - 17:03
      +5

      You're correct, merchant isn't refunded the fee but as you say it's a cost of business and the customer should be refunded. That's how we handle it.

  • Jimothy Wongingtons on 01/10/2023 - 15:48
    +1

    Idk man, the fee is really only there to cover the costs involved with ACCEPTING payment. I cbf looking up how much centrecom in question charge but if they are abiding by the law it should be in line with what provider charges.

    Item in the transaction is kind of irrelevant.

    There also doesn’t seem to be any Accc or similar ruling on refund of these kind of fees either.

    But, looking at the votes by all means op if you want to go with the crowd, would love to see how far you get with perusing it.

    • meong on 01/10/2023 - 15:52

      well…

      I'm not questioning the fee for the purchase itself. It is 1.2% based on the transaction that I made.

      I was more questioning on whether I should be getting a refund of the transaction fee itself if the product has been refunded anyway.

      ACCC says:

      "A refund should be the full amount the consumer paid for the product. The business must not deduct an amount from a refund to take into account the use a consumer has had of the product."

      But what is considered the "full amount"? Is the full amount the price of the product or the whatever that I paid on Saturday?

      I can live with few dollars loss like this but imaging if I was buying a DOA nvidia 4090 let's say… The card transaction fee would be annoying to swallow.

      So I agree its not clearly covered in ACCC.

      • Jimothy Wongingtons on 01/10/2023 - 15:58

        The business must not deduct an amount from a refund to take into account the use a consumer has had of the product."

        That to me is more like if you used an item for 2 weeks then it went faulty , they can’t say well here is a pro rata refund as the item lasted 2 weeks first.

        The full amount was the item price, imo , surcharge would surely have shown up as an invoice charge line or seperate line at subtotal?

        If you can be bothered and do chase up with accc with clarification please do come back and share here for future reference.

        • meong on 01/10/2023 - 16:08

          Yeah it was indeed shown as separate line item as "Credit Card Fee" before GST but then after GST only shows the full amount I need to pay.

          I lodged a case with ACCC anyway but not sure if they really respond to anything these days.

          • Jimothy Wongingtons on 01/10/2023 - 16:19

            @meong: Generally do but if it was 2-5 week turn around I wouldn’t be surprised

          • apsilon on 01/10/2023 - 17:02
            +2

            @meong:

            I lodged a case with ACCC anyway but not sure if they really respond to anything these days.

            ACCC has never handled individual cases. You may get a reply stating as much or you may get nothing. Your complaint is just lodged and they look for patterns/repeat offenders who they then take action against. It's fair trading that handles individual complaints.

            • meong on 01/10/2023 - 20:10
              -1

              @apsilon: Oh well, I have expected that…

    • deme on 02/10/2023 - 09:32
      -1

      No, this is wrong.

      The customer is entitled to compensation due to consequential damages.

      That includes things like, the GPU starts a fire, the card fees, etc.

      OP should be no worse off than if they didn't purchase it.

  • Nugs on 01/10/2023 - 17:19

    ca$h i$ kinggggg
    .

    • meong on 01/10/2023 - 21:17

      Well… no longer according to this article:
      Link

  • onceupon8 on 01/10/2023 - 18:21
    +2

    There is no correct answer to this. I am guessing legally they only need to provide a full refund for the item price for the item you are returning. The service - allowing you to pay on credit card and the resulting credit card payment fee - was provided correctly without fault - so no refund is due on that.

    As a gesture of goodwill, I would think it's best for most retailers just to refund the whole amount. But for low margin computer retailers like Centrecom - I would think it's also reasonable for them to not refund it.

    If they were going to refund the payment fee where they don't get a refund of the payment fee back from their bank, it would be reasonable for them to charge a payment fee MORE than what their bank charges them. eg. If their bank charges them 1.2%, then they charge consumers 1.4% and the extra 0.2% helps cover their losses where they refund a payment fee. But I don't think they are legally allowed to do this.

    To the Op:
    1. Be grateful that you got a full refund of the item on the spot. Centrecom are legally allowed to have your item sent back to a service centre etc to make sure the item is faulty before refunding you (many retailers don't have qualified staff that are able to check electronic/computer items on the spot - especially if it's not clear cut).
    2. Many ozbargainers wouldn't be paying card surcharges in the first place. They would use a debit card or cash to avoid such surcharges.

    • meong on 01/10/2023 - 21:12

      EDIT: the above actually happened last Sat and Sun. Updated the wordings above.

      1. I was indeed grateful for the immediate refund. The general attitude was bad from them the moment I said "I would like to return an item I bought yesterday". They also tried to argue with me on technicality (product was able to be turned on but the function was broken). Initially, they only agreed for a swap over until I point out an ACCC poster they had on the counter which showed that I was indeed entitled for a refund. Even then, it took a manager to step in after the store person was unable to confirm the defect and the manager just overrode the process and refunded me anyway. So, based on that, I was happy to get my full refund and leave to avoid further interactions from them. Few days later I noticed Amazon dropped their prices so I eventually bought from Amazon and it immediately worked out of the box.

      2. Some retailers do not have that many options and in some scenarios may force you to card transactions. Some online retailers may allow bank transfers but will require few days for the payment to settle. However, in this case, the purchase was made in-store and I should have been able to purchase using cash. I was okay for the surcharge cause it was only few dollars anyway. This post was more asking about the norm and/or legal obligations with hopefully getting some perspective from business owners.

  • USER DC on 01/10/2023 - 20:39
    +1

    I guess morally it should depend on what type of return it was.
    e.g.
    DOA- should be refunding everything or giving a free optional replacement
    Change of mind, only the item price refunded.

    • meong on 01/10/2023 - 21:12

      But what is it legally? still unclear atm.

  • randomusername2017 on 01/10/2023 - 20:42

    Was the initial transaction that incurred the fee successful?

    Did they charge a fee for the electronic refund?

    • meong on 01/10/2023 - 21:16
      -1

      As mentioned above, but will clarify:

      I had 2 transactions in my statement as it wasn't a full reversal.

      1. One for the purchase + surcharge which was pending at the time i asked for the refund
      2. The refund as credit in the full price of the item (without the surcharge)

      So let's say if the item was $100, i would have paid $101.2 and received a refund of $100.

      There was no fee for the credit.

  • Ryk on 01/10/2023 - 23:16
    +1

    The transaction fee is you buying the card payment for the goods you bought. That payment was successfully approved with no issues so no refund on that. Potentially they could also argue for a fee on the successful refund of the goods returned.
    Use cash, no fees.

  • WookieMonster on 02/10/2023 - 01:03
    +13

    I am assuming you paid via Visa or Mastercard, considering those are the only two payment networks Centrecom supports under the Credit Card option on their online checkout? If so, Visa and Mastercard rules say a refund of a previous transaction is supposed to include a refund any surcharges applied to the previous transaction.

    Visa Core Rules and Visa Product and Service Rules (Page 112):

    1.5.4.15 Credit Refund Requirements
    In the AP Region (Australia, New Zealand), Canada Region, Europe Region, LAC Region (Chile), US Region, US Territory: The Merchant must refund any surcharge assessed on the Transaction amount. For partial refunds, the surcharge amount must be pro-rated.

    Mastercard Transaction Processing Rules (Page 108):

    3.14.1 Refund Transactions
    In Australia, the Rule on this subject is modified as follows.
    When the original purchase Transaction includes a surcharge, the refund Transaction must include the full or prorated surcharge amount.

    • deme on 02/10/2023 - 09:32

      Oooof

    • meong on 02/10/2023 - 16:29

      Wow, thanks for this! Now the question would be who should be enforcing it?

      It doesn't seem to be unlawful for Centrecom to do that but it seems like its breaking Visa and Mastercard 's TOC.

      Btw, payment is done at a store.

      In my understanding, if we perform a reversal, the transaction would be fully refunded as if it never happened (pending transaction disappears) but in the case of Centrecom, they only did a direct credit instead of a reversal.

  • taradavey on 02/10/2023 - 09:34

    Every single business in Australia gets charged Credit Card fees for processing credit card payments.Some businesses pass this fee on to the customer, some don't. If it's not a small business, this fee being passed on to the customer puts a bad taste in my mouth in the first place. With small businesses I find it more understandable. Big companies like Aldi for example, I'll do whatever I can to avoid this fee (pay cash, use debit card if they don't charge the fee on debit card)

    I agree that you should have been refunded the full transaction amount.

    • apsilon on 02/10/2023 - 13:38
      +1

      Some businesses pass this fee on to the customer, some don't

      They all do or they wouldn't be in business for long if they can't work out something as basic as covering their costs. The difference is some add it as a visible surcharge and others just build it in to the price.

      • taradavey on 02/10/2023 - 14:51

        Correct! But when it comes to retail items with a set RRP, you wouldn't see this as much as if it were a service based product.

  • hullohullo on 02/10/2023 - 13:29

    Had this happen with TGIF. They refunded me sans the card fee. I no longer dine there as a matter of principle.

  • [Deactivated] on 02/10/2023 - 14:56
    -1

    What about commute to the store & back expenses for both trips?

    Internet charges to lodge the ACCC case?

    Your time & effort?

    Expenses for pain & suffering?

    • meong on 02/10/2023 - 16:21

      Commute to store and back is actually covered in ACCC as buyer needs to be responsible for paying for return shipping or bringing it back to store/supplier.

      So we should be grateful of online stores that provide free return shipping…

      • [Deactivated] on 03/10/2023 - 22:45

        I think they were taking the piss.

        • meong on 04/10/2023 - 10:15

          you'd be surprised not many people know what's covered and not covered in ACCC rules

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