Your money's no good here

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This was published 14 years ago

Your money's no good here

Claws out ... Tiger Airways dictates the use of a certain credit card.

Claws out ... Tiger Airways dictates the use of a certain credit card.Credit: Paul Rovere

They made great efforts to steer us away from using credit cards but now airlines are telling us plastic is fantastic. Continental Airlines, Northwest Airlines and Delta have joined fellow US carriers American Airlines, United Airlines and Southwest in switching to "cashless cabins", with air crew no longer able to accept cash as payment for drinks and snacks on board.

Crew members carry hand-held devices for processing credit cards payments and those without a piece of plastic find themselves going hungry and thirsty.

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There could even come a time when you need a credit card to spend a penny, with no-frills European carrier Ryanair reportedly still pursuing options for pay-to-use aircraft toilets. The carrier is said to have explored both coin and credit card swipe options in its discussions with aircraft manufacturers.

There has so far been no hint of cashless cabins being introduced in Australia but it is probably only a matter of time, with Australian carriers tending to follow moves made by their US counterparts.

In the meantime, a word of warning to passengers travelling in the US: any on board credit card payments you make for drinks and snacks could cost a lot more than you bargained for if your card provider charges currency exchange and overseas transaction fees.

The move to cashless cabins comes as airlines and other providers are increasingly dictating to customers what methods they should use to pay for their travel.

Hefty charges have been attached to the convenience of plastic, with fees for using credit cards and even debit cards now widespread.

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Companies are driving customers to alternative forms of payment such as direct debit and BPAY, which are cheaper for them to administer.

Credit card fees are not unique to the travel industry but it is a sector that has taken them up with greater enthusiasm than most.

Tiger Airways is an interesting case in that it dictates the use of a particular card in order to get the cheapest fares.

All fares advertised on the Tiger Airways website carry the tag line "payment by Australian-issued MasterCard debit card only", potentially giving the impression that a booking cannot be made without that particular card. The fine print reveals other credit and debit cards can be used, subject to paying a "convenience fee" of $6 a passenger, per sector.

A spokeswoman for Tiger says bookings can also be made and paid for through the airline's call centre. The spokeswoman says different forms of payment have different associated costs and the fees reflect these variances.

The MasterCard debit card option makes Tiger the only airline in Australia that offers a fee-free card payment option to passengers booking online.

Setting aside convenience and the ability to delay or spread the cost of your booking, one of the big downsides of not being able to use a credit card without penalty is that it makes it harder to double dip on frequent-flyer points.

When using a credit card to pay for a flight, a passenger can potentially claim points for the actual flight as well as the money spent on their credit card.

Thankfully, airlines have also made moves towards introducing payment options that are quick and convenient without incurring fees.

Virgin Blue, Jetstar and Air New Zealand have adopted a payment system called POLi, which works with your internet banking to facilitate a quick and easy direct debit payment.

POLi is free to use and the company behind it says no account details or personal information are revealed to the airline.

Card fees can sting

WITH fees for different methods of payment varying enormously, travellers are well advised to do the sums when making a booking.

Many fees appear modest but can really add up if you are paying for several passengers or several flight sectors.

For example, Virgin Blue charges $3.50 a passenger per flight sector for using a credit card, amounting to $28 for a family of four making a return journey within Australia.

Qantas charges a flat $7.70 a passenger fee for credit card payments on domestic and trans-Tasman services and $25 a passenger for international bookings — an extra $100 for a family of four travelling overseas.

Most travel agencies also charge fees for credit card payments but policies vary, so it pays to check terms and conditions.

Many big-brand travel agency websites accept credit card payments only for bookings made online but the associated credit card fees can usually be avoided by booking through an individual agency and paying by another method, such as direct deposit or cheque.

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