THE "hidden" fees that can be slapped on to a credit card trans- action have angered consumers and sparked calls for more transparency.
Many of these fees are imposed when payments are routed through overseas processors, leaving the card holder with a higher bill than he bargained for.
Oil analyst Tushar Tarun Bansal found such discrepancies in his credit card bills for a couple of transactions with the amount owing higher than what he originally signed for.
One instance was when he bought a ticket from Swiss Airlines from Singapore to London and chose to pay in Singapore dollars. The credit card bill was $87 above the initial amount.
Mr Bansal, 33, told The Straits Times: "That was surprising. If you buy it on other airlines or for any other thing, what you pay is what you receive on the bill.
"Apparently, the merchant routed that transaction through a non-Singapore entity, (adding) a charge of 0.8 per cent. That was surprising as no information was provided."
Mr Bansal contacted Swissair. It said it could not help as the charges were issued by the bank, which said, in turn, that it would investigate.
He has since received a refund from the airline and was told it was a "gesture of goodwill". But he was troubled that extra charges were not disclosed upfront on credit card statements.
The Consumers Association of Singapore (Case) came across another incident where charges were unclear.
Its executive director Seah Seng Choon said a consumer booked a hotel room in Hong Kong for three nights online. The hotel asked the customer to pay HKD1,830 ($297) on check-out but an additional HKD2,013 was charged to his credit card by the hotel when he returned to Singapore.
"He requested for the company to clarify the discrepancy and refund him the difference in pricing," said Mr Seah.
In a joint reply to Mr Bansal's concerns, the Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) said card issuers generally state that Singapore dollar payments routed through overseas payment processors attract additional service charges.
These additional charges may vary from bank to bank and are usually stated in the list of terms and conditions.
Maybank Singapore said there is a 0.8 per cent service fee imposed by the scheme operators, such as Visa or MasterCard, for Singapore dollar payments routed through overseas processors.
It is difficult to find out if a transaction goes through an overseas payment processor but if the bill is the same as the amount paid at the point of sale, then it is safe to assume that it has not.
MasterCard and Visa earn transaction fees from issuers like banks and acquirers - firms that process purchases - for the network and the services provided, which are typically passed on to shopkeepers.
Ms Karen Low, head of cards and unsecured lending at Maybank Singapore, added: "Generally, the charge for foreign currency transactions is 2.5 per cent.
"For most of Maybank's cards, this comprises an administrative charge of 1.5 per cent by the bank and a 1 per cent charge by the scheme operators."
Ms Wong Chung Yee, OCBC Bank's head of cards, said: "In cases where the card member's local transactions are processed via an overseas payment gateway with the option of being paid in the local or foreign currency, we do not impose any processing fees."
The bank added that the amount on the credit card statement will be the same as the amount at the point of transaction for overseas transactions paid in Singapore dollars.
The MAS and ABS added that "more can be done to improve transparency and disclosure to consumers".
This will be released later this year.
Mr Bansal said he was deeply dissatisfiedby the MAS and ABS as their reply merely sidesteps the whole issue.
"It's effectively a one-sided thing, that is, putting the onus on the consumer but no talk about what the banks should or can do. It isn't very fair," he said.
Case has been contacting banks on behalf of consumers but Mr Seah said it gets little or no response.
"It's time the banks look at this, I think there is a clear need for transparency," he added.