IndiGo Airlines’ website says with effect from 1 May 2015, the convenience fees is Rs 75 per passenger if payment is made through net banking or cash cards and Rs 150 per passenger if payment is made through credit/debit cards when booking is made from its website. It pays online agents like Cleartrip, Makemytrip etc. 2 percent transaction fee in addition to the year end bonus based on volume generated for the airline by them. The agents too on their part charge convenience fees for online payments. Thus direct booking i.e. through the airlines’ website should be cheaper but then it is always not the case because often the agents, confident of earning year-end bonuses, offer discounts to woo customers from airlines’ website as well as from competing online agents. Be that as it may.
Transaction fee is a euphemism for the rather soiled word ‘commission’. It is strictly between the airline and its agent. If the traveler wants to duck its impact he can go directly to the airlines’ website. But convenience fee he cannot duck in any case. Cards are finding increasing use in the country but net banking is still in its infancy at least amongst the households though business and other organizations are adopting it enthusiastically. Those booking through IndiGo website may be tempted to make payment through net banking rather than through cards given the 50 percent savings on convenience fees. Be that as it may again.
The moot question is why convenience fee at all. Does a petrol depot charge convenience fees if I pay through cards? No. Does an insurance company charge convenience fee if I pay online premium through cards? No. Does a store charge convenience fee when instead of paying cash you pay through cards? No, though when cards were making their advent in India, some of the stores and shops did charge extra for entertaining card payments. BSES Rajdhani, one of the discom in Delhi charges 1 percent extra only if card payments are in excess of Rs 5,000 in a transaction.
15/07/15 S Murlidharan/First Post
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Transaction fee is a euphemism for the rather soiled word ‘commission’. It is strictly between the airline and its agent. If the traveler wants to duck its impact he can go directly to the airlines’ website. But convenience fee he cannot duck in any case. Cards are finding increasing use in the country but net banking is still in its infancy at least amongst the households though business and other organizations are adopting it enthusiastically. Those booking through IndiGo website may be tempted to make payment through net banking rather than through cards given the 50 percent savings on convenience fees. Be that as it may again.
The moot question is why convenience fee at all. Does a petrol depot charge convenience fees if I pay through cards? No. Does an insurance company charge convenience fee if I pay online premium through cards? No. Does a store charge convenience fee when instead of paying cash you pay through cards? No, though when cards were making their advent in India, some of the stores and shops did charge extra for entertaining card payments. BSES Rajdhani, one of the discom in Delhi charges 1 percent extra only if card payments are in excess of Rs 5,000 in a transaction.
15/07/15 S Murlidharan/First Post
