I wonder come July, retailers like this pub (pic above) will proudly put up the banner which says, "Good thing there's NETS!"
I would change it to "Good riddance to NETS!"
NETS has announced that from July, it will charge businesses between 1.5 and 1.8 per cent of the amount of each transaction. Previously NETS charge only 0.35 and 0.55 per cent. As you can see, this is no small jump and you bet that companies will be unhappy.
The Consumers Association of Singapore (CASE) has a lodged a complaint to the Competition Commission of Singapore. It has questioned the actions taken by NETS:
Its president, Yeo Guat Kwang, said: "You are telling me, you know now Toyota has to also fetch the same price as a Lexus... is this a reason? I don't see this as a reason, you can't accept such a reason.We are all consumers and most of us use NETS to pay for our purchases so I'm very sure that this will affect us - we may have to pay more just to use NETS which I think is totally ridiculous. So if you are a consumer or a retailer and you are unhappy with this decision by NETS, I think the best way is to let them know. Direct an email to their CEO Poh Mui Hoon or jam their phone lines. Tell those people at NETS that you won't be using NETS if they insist on taking advantage of consumers and retailers like this. Remember there's always an alternative such as debit cards, credit cards and good old fashion cash! If NETS think they can just do this without any repercussions, then they are so wrong.
"If it is cost factors, then they must come out to justify what are the main reasons... what are the key cost factors which will make them think that the current fee that they are charging, 0.3 to 0.55 is too low. Too low in what sense? Can't cover all the cost, or is the profit not enough?"
CASE is also worried that businesses may pass the cost increase to the consumers.
Although existing regulations do not allow this, Mr Yeo said retailers could still tweak product prices if they want to.
Good thing there's NETS? Good riddance man!
Update 26/06/2007 : The Competition Commission of Singapore said that the fee increase by NETS is not an infringement of the Competition Act. It added that there are alternative payment methods such as credit, debit and EZ-Link cards that consumers can use.
19 comments:
So much for pushing their "NETs It" campaign and now this! Hope her email gets jammed up. LOL
Try to pay via Nets in Sim Lim after the increase you we will probably be told that we have to add 2 percent to the cost, just like for Visa card.
This is a step backwards man...
I'm gonna be NET-ing till the cut off date. After that is hard cash liao...
Even before this there are quite a few retailers that do not accept NETS.
I think it irks everyone because NETS has been a way of life for Singaporeans for many many years and it's like it has become a national initiative.
i hope case do something about it but even if they fail to stop them, just pay cash lor.
To quote the nice chap from CASE: MONOPOLISTIC!
Retailers are not supposed to charge the customers the extra increase in levy charges? Does Nets think that all retailers are cash cows??
If all Singaporean dun use nets they sure bankrupt liao!
retailers will keep using nets if their custormers demand for it.
and customers that will use nets, will end up paying for it because it is too expensive for retailers to cope themselves.
It all boils down to...
PROFIT NOT ENOUGH!
The 'Good Thing There's NETS!' Ad/Banners/Campaign will have to be taken down from July onwards because it is not relevant anymore
i seldom nets nowadays.. prefer use my debit card... hehe.. more cool ya.
NETS bastards.Plain greed, pure and simple.
So what's the choice here? Credit card companies making the money or GLC making the money?
Is that even a choice?
I know I will stop using NETS.
Any economics student will tell you that this is likely a classic case of monopolistic pricing. The assertions by NETS are simply laughable.
Since the dawn of time when did any business increase their prices in response to competition?
Furthermore, if the competition is charging a large multiple of the fees NETS has managed with happily all these years, that's good news for NETS. How on earth can these debit cards be threatening NETS in any way when they (apparently) charge so much more in fees? Surely, NETS owes us some more detailed information on this story than we have.
And it is not as if the price increases are exactly small. Even if you look at the ratio of the smallest new fee to the largest old fee NETS is hiking up fees (and its fee revenue) 172% relative to where they are now. The actual number will surely be larger. This is a huge increase. Common sense tells us that there is more to this; surely NETS, a so far welcome part of the Singapore business scene for years and years must be under some unique pressures.
I should tell my favorite hawker stand guy this, "whenever you have more stalls near you, increase your price, lah".
The best part is that Nets as a private organisation has never shared any of their financial information like how profitable they are, their margins etc. They would of course prefer not to, but seriously with this kind of increase, if they have a financial reason to justify the increase, I am sure the public will be more understanding. The only data they are releasing are number of retailers they have as well as terminals.
LIke some of you said, it all boils down to pure and simple greed.
Please remember that the 3 sharholder banks of Nets issue a large proportion of the debit cards that Nets is using as an excuse for the rate increase.
I have a post on this at www.asiaflux.com/blog1 if you wish to read more.
Haha, I had just sent a feedback to CCS on misleading in NETS website. Check out http://www.nets.com.sg/consumers/feechanges&you/news190607.asp
The problem lies on question 2. As the NETS hike only in effect from 1 July onward, it seems like NETS trying to mislead us thinking merchant feel the NETS hike acceptable by quotating Miss Gan Chai Har words "My customers are not affected by this fee adjustment and they are still using NETS for payments." They should have remove that sentence.
Now NETS has approval to increase its charges, we will soon hear from credit/debit card they will increase their fee to stay competitive too. Then NETS increase again, credit/debit increase after.... when will it stop?
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