Credit Cards

Verizon Cancels $2 ‘Convenience’ Fee

Comments 2 Comments

Just one day after announcing that it would charge it’s wireless customers $2 for one time credit and debit card payments made over the phone or online, Verizon has scrapped plans for the new fee.

The company cited customer feedback for the abrupt reversal.

“At Verizon, we take great care to listen to our customers,” said Dan Mead, president and chief executive officer of Verizon Wireless, in a press release. ”Based on their input, we believe the best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time.”

[Consumer Resource: Mystified by your credit? Learn how it works and where you stand with Credit.com’s Free Credit Report Card.]

Other factors may have played a part in the course change. Credit.com’s personal finance expert Gerri Detweiler wrote a piece which explored the question of whether or not the new fee could be considered a surcharge for credit card users. Surcharges for card use are expressly forbidden by Visa and Mastercard, and prohibited in a number of states. She writes:

FREE TOOL:
CHECK YOUR CREDIT

Credit.com’s Credit Report Card
Check your credit bureau profile for free with this great tool. See your detailed credit evaluation, expert advice on managing your credit, and unlimited free updates every 30 days.
Get Started Here »

“Generally, the card companies – and state law – allow discounts for those who pay by cash or check. But if you’re a merchant and you want to go that route, you can’t just call a surcharge a cash discount. You actually have to offer a discount off the retail price for those who pay by cash or check. If Verizon did that, it would mean that customers who paid with online ACH withdrawal, or in person by check or cash, would actually pay less than they are paying now… The card companies really aren’t terribly fond of merchant’s attempts to pass along the merchant fee to cardholders, since it may discourage cardholders from using their credit or debit cards to pay bills or buy merchandise. If they allow Verizon to impose this fee, then what’s to stop any company that accepts credit card payments online or by phone from adding a convenience fee? Theoretically, at least, a store like Best Buy or an airline – both of which have physical and online presences – could impose a surcharge for online payments and call it a convenience fee.”

Read the rest of Gerri’s piece here.

[Featured Products: Research and compare credit monitoring plans at Credit.com]

Image: VerizonWireless.com

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • http://www.creditsense.com/ BradB

    This is a great small victory for all Verizon customers. That was even faster than Bank of America changing their minds on the $5 fee they were going to charge. It just feels good to get at least a little something from these big corporations.

  • http://www.wecometoyouwithcash.com/ Kevin

    I have a love/hate relationship with Verizon. I love their service and coverage but they sneak in a lot of fees that I was not expecting. So many corporations are trying to charge us mystery fees but once they realize that consumers will group together and have no problem dropping their contracts or service, they tend to take it back. Netflix, B of A and others are learning tough lessons.

Find out where you stand.
Get your FREE personalized credit report card.

Sign Up Now
X

Stay Connected to Our Experts

Please submit your email address to get credit & money tips & advice
from our team of 30+ experts, delivered weekly to your inbox.