Thursday, January 8, 2009

You can take your service charge and....


Picked up a parking ticket in Ottawa last night. Long story but we knew better, took a chance, and lost.

But here’s the rub – payment options:
1. By phone with credit card and service charge.
2. By internet with credit card and service charge.
3. By mailed cheque with no service charge.

Think about that for an instant.

If you mail in a cheque it has to be delivered, handled by the city’s mailroom staff, physically sent to the appropriate department(s) for processing, bundled up with all the other cheques, carried to the bank, deposited, and then reconciled against the receipts. For all that effort there’s no fee. But if you pay online everything is done electronically and the city has to do absolutely nothing except to confirm receipt of the money in its bank account. For that option there is a $1.50 credit card processing fee.

As my dear old Dad used to say, “That’s ass-backwards, son”.

If the city was really interested in reducing costs they’d knock $10.00 OFF the ticket for online payment and save all the handling costs associated with a physical cheque. But no, that would make too much sense. So instead they get to deal with people like me who will send in a cheque because it costs me no more to do so and (the best part) it makes them work harder for my money.

7 comments:

saskboy said...

They must have figured that most people pay by credit or online, so they would skim more off of that way than by putting the charge on a cheque.

Beej said...

Perhaps it's because the person/s required to process the cheque, and all the 'personhours' of labour involved, are members of a union. Sounds like a 'make-work' project to me...

Jennifer Smith said...

Blame Moneris. Credit card processing companies like Moneris charge merchants (in this case, the city) for every transaction - both a flat fee of 15-25 cents, and a percentage of usually between three and five percent.

On a $50 ticket, that's going to be more than the $1.50 they're asking for.

Canajun said...

I suspect you're all right to a degree.
Jennifer - I called the city and asked them about the surcharge (using up more of their resources) and was advised that it is a charge by the credit card company and the city gets none of it. But even so, it would still be in the city's best financial interests to cover those costs when compared to the alternative.
Now if Saskboy is right and most people say the hell with it and pay online anyway, then the point is moot from the city's perspective.
Either way, my cheque is in the mail.

Baron's Life said...

They gonna rip you off any which way they can...You should know this by now....Ask your dad

Canajun said...

Sadly, true.

Canajun said...
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