Nets defends fee hike on its website : ST 9 June 2007
STUNG by the negative publicity it has been getting over its impending fee hike, Nets yesterday launched a defence of its decision on its website.
It published a '10 Frequently Asked Questions' segment which assured consumers that retailers were not allowed to pass on the merchants' transaction fee to them.
Among the information available is a hotline number and e-mail address for consumers to inform Nets of errant merchants.
Nets is the Network for Electronic Transfers Singapore. It is owned by three local banks: DBS, UOB and OCBC.
On its Web portal,
www.nets.com.sg, the operator of the cashless electronic payment system also asked for public feedback on the issue.
From July 1, retailers' transaction fees will increase from the current 0.35 to 0.55 per cent of purchases, up to 1.9 per cent.
The fee hike will be done in three batches, affecting some 13,000 retailers.
On its website, Nets quoted Mr Kwek Hong Lim, the chief executive officer of Yes Supermarket, as a supporter of the fee increase.
Mr Lim assured consumers that his company will not pass on the increase to them.
He added: 'Nets has committed itself to do more promotions with us. I don't mind paying more, provided Nets takes a more active promotional stance with merchants.'
Nets has promised to give small and medium-size enterprises up to 25 per cent rebate on their transaction fees until Dec 31.
Mr Lim, however, is among a very select minority who support the hike.
A total of 3,110 readers took part in an online snap poll on The Straits Times' website,
www.straits times.com. Of these, 85 per cent indicated they will not continue to pay by Nets.
The Straits Times also polled 30 retailers. Most were unhappy with the fee hike.
Two indicated that they will give up the Nets facility within the year, 12 are 'seriously considering' giving up Nets, while 17 said they will continue using the facility.
Ms Angela Ang, 50, owner of an electronics store at Lucky Plaza, said: 'Why should we let Nets gain? If we change to credit card machines, at least my customers benefit.'
Nets' counter - international debit cards would result in significantly higher interchange fees for merchants, and the same holds true for credit cards.
The Consumers Association of Singapore (Case) has slammed the fee hike, which it feels will be passed on to consumers.
One retailer, Dynasty Shoes, has been passing the charge to consumers since April 1, even though Nets said it was not supposed to.
Both Case and Nets came out strongly against Dynasty Shoes' action. But its owner, Mr Patrick B.W., said he will continue levying the 1.7 per cent transaction fee on customers paying by Nets until he is told otherwise.
Nets stood its ground yesterday, reminding merchants not to impose a transaction fee or a minimum purchase amount for Nets payment, as this was not allowed under the agreement.
Consumers can call 6274-1212 if they come across such cases, it added.
As for doing away with the fee hike, however, Nets explained that this was not possible
'The options are either for Nets to adapt to this entirely new business model and adjust to this now, or not exist in the future.'
