Problems regarding a visa charge for SQ ticket

[zander]

I recently bought an SQ ticket, SFO-SIN, and the transaction was done through their worldwide reservation centre(ICC) and in US dollars. Furthermore, the ticket was issued from the LAX office. However when I checked my bill I found that the transaction even though it was in USD was billed to the headquarters in Singapore resulting in me getting hit by a foreign transaction point of sale charge of 2.5% because the country code for the transaction ID was listed as SIN.

After tons of calls, i manage to get the charge waived but i found it weird that the bill for the ticket was sent to the office in SIN even though it was issued in the USA. Anybody had any experience with this and how to avoid it in future?

[jhm]

I assume you mean the charge on your credit card was taken by Singapore rather than the US.

In any event, I'm not sure that's relevant nor the part where you refer to the country code for the transaction ID. Perhaps I'm wrong but isn't the only factor which counts is whether your USD credit card gets charged in USD (in which case there's no conversion cost) or any other currency (in which case there is) ? It shouldn't matter which entity takes the money.

Edit: assuming the above is correct, it seems that it was simply SQ's mistake in (for whatever reason) charging you in SGD (or whatever currency it was) rather than USD.

[zander]

SQ was charging me in USD. I am positive of that. And after several calls to all my other creditors from different banks, I managed to find out that its their policy to charge a foreign transaction fee when the location of the merchant where the payment was sent to is outside of USA even though the transaction occurred in USD(in this case its SIN).
Just that different banks have different rates and I will probably use the one with the lowest in future.

Edit:After searching through websites, I discovered that there are only two US-issued cards that do not have such charges and those two are pretty crappy.


Seems like there is no way to bypass this if the payment gets routed to SIN all the time but its funny that they do this when they have ticketing offices in LAX and NYC plus the fact that the reservations number is for the USA market even though it gets routed to India.

[matt_will_fix_it]

My understanding that this isn't a SQ problem (as long as they charge you the correct amount it doesn't matter which country charge was made from). More its a sign of the cr&py US banks getting more commission on transactions in their own currency. You'll have the same issue with other merchants based outside of the US who are registered overseas.

When booking online at SQ.com they do say "Please note that a small number of payment card issuers may charge a transaction fee for booking on our website. Please check with your payment card issuer directly ". Perhaps they should have advised you of the same when on the phone.

BTW - who waived the fee? I'm guessing it was the bank (as they were the ones that charged it) and not SQ.

[HUGE AL]

I've never encountered this problem when booking my tickets on foreign (non-USA) carriers. I use AMEX.

[StarG]

Time to apply for an Amex card.
Mine is issued in the USA and I never get charged any transaction fees anywhere, including for SQ tickets purchased in Indonesia. The ticket is charged in USD with no rate conversions involved.
You earn 1 worthless KF miles per 1 USD too!

[Bitterroot]

Time to apply for an Amex card.
Mine is issued in the USA and I never get charged any transaction fees anywhere, including for SQ tickets purchased in Indonesia. The ticket is charged in USD with no rate conversions involved.
You earn 1 worthless KF miles per 1 USD too!

Actually, even if you bought the ticket in Indo, and paid in Rupiah, you wouldn't be charged a transaction fee if it's an American Express card. It would simply be billed to you in US$ at the banker's exchange rate in effect on the day the transaction settled. I -- and I'm sure other posters on here as well -- buy tickets in Singapore or Indonesia all the time, priced in the local currency (the fares are often cheaper than buying in the USA, or the fare classes are simply not for sale in North America, the EU, or the UK).

Looks to me like, as others have said, that OPs problem is the bank issuing his credit card.....it's got nothing to do with SQ.

Oh, and here lately, you get 1.52 PPS qualifying points for every US $ spend! (Still -- much better than the 1.34 multiplier earlier this year..........)

[StarG]

Actually, even if you bought the ticket in Indo, and paid in Rupiah, you wouldn't be charged a transaction fee if it's an American Express card. It would simply be billed to you in US$ at the banker's exchange rate in effect on the day the transaction settled. I -- and I'm sure other posters on here as well -- buy tickets in Singapore or Indonesia all the time, priced in the local currency (the fares are often cheaper than buying in the USA, or the fare classes are simply not for sale in North America, the EU, or the UK).

Looks to me like, as others have said, that OPs problem is the bank issuing his credit card.....it's got nothing to do with SQ.

Oh, and here lately, you get 1.52 PPS qualifying points for every US $ spend! (Still -- much better than the 1.34 multiplier earlier this year..........)

I brought up tickets bought in Indonesia because unlike in SIN or most other countries, tickets in Indonesia are sold in USD. I was worried that it may be charged in the Rupiah equivalent (at exorbitant airline rate) then get converted back to USD by Amex. But it was fortunately not the case (at least) for SQ tickets.

What PPS qualifying points are you talking about?
Miles/points from Amex don't count towards PPS/elite qualification.

[Bitterroot]

What PPS qualifying points are you talking about?
Miles/points from Amex don't count towards PPS/elite qualification.

Correct -- it's not the Amex connection that would get you the PPS points: it's flying F or J on SQ or MI.

Still, you raise a good point -- SQ, for one, uses the IATA exchange rate to calculate things like PPS points. Amex uses the prevailing bankers rate to bill the cardholder. They are not the same; the IATA rate lags the bankers rate because it's only adjusted once every 30 days. That's good when the dollar is falling; not so good when it's rising, and the same for Euros or Pounds.

Now, if you pay for a ticket in Indo in Rupiah, and the transaction goes through to Amex in Rupiah, I don't see how any airline could convert the charge to dollars or anything else using some weird exchange rate. In fact, IIRC, Indonesian banking regs require charges at hotels (for example) to be made in Rupiah. But airline tickets could be different, and my experience, like yours, is that many -- including those on the SQ website sold ex-Indonesia -- are priced in US dollars from the start.

[StarG]

Ah okay, thanks for clarifying.

I can't speak for other airlines in Indonesia, but for SQ they are able to charge the card in USD.
Didn't know IATA rates are updated just once a month. Good to know that for reference.

[jhm]

But airline tickets could be different, and my experience, like yours, is that many -- including those on the SQ website sold ex-Indonesia -- are priced in US dollars from the start.

But perhaps this simply means that the airline does the conversion from Rupiah to USD using its own (maybe disadvantageous to you) exchange rate ? Similar to some hotels which "helpfully" offer you the option of billing you in your credit card's currency instead of the local currency (which I always decline on the basis that the hotel must be making something out of it) rather than letting the credit card company do the conversion.

AFAIK, none of my UK issued Amex, VISA or Mastercards operate like how the OP's does, i.e. what's important for me is whether the currencies are the same (and if not, it'll be converted by the bank plus - if applicable for some cards - a percentage commission); but if I get billed in Sterling by an overseas merchant, I should pay exactly that without incurring any additional charges.

[Bitterroot]

[QUOTE=jhm;75353]But perhaps this simply means that the airline does the conversion from Rupiah to USD using its own (maybe disadvantageous to you) exchange rate ? Similar to some hotels which "helpfully" offer you the option of billing you in your credit card's currency instead of the local currency (which I always decline on the basis that the hotel must be making something out of it) rather than letting the credit card company do the conversion.

AFAIK, if the sale is made in a given currency, the transaction has to go to the payee (in this case, the credit card company) in that currency. In Indonesia, that's the way it's supposed to work. Now, that said, I've heard stories about "helpful merchants" ditzing with exchange rates -- that might mean they offer to convert for you before submitting the transaction for payment. One could get badly abused that way.

And I agree with your observation about OP's credit card -- seems strange to me, and definitely outside my experience.

[TerryK]

......but if I get billed in Sterling by an overseas merchant, I should pay exactly that without incurring any additional charges.

Many US based Visa/MasterCard as well as AmEx change a "foreign transction fee" now. If you are billed by a foreign based merchant, even if in USD, you are still being charge a foreign transaction fee, which is separate from conversion premium. It is listed as a separate fee on a separate line in the statement. It is nothing but pure profit for the card issuers. Note it is the card issuer who charges the fee, not the merchant, nor Visa/MasterCard network.

[StarG]

Many US based Visa/MasterCard as well AmEx change a "foreign transction fee" now.

Does it apply to ALL AmEx cards or just certain types of AmEx?
I didn't get charged any foreign transaction fee on my last trip outside US.

[TerryK]

Does it apply to ALL AmEx cards or just certain types of AmEx?.....

I don't know. There are too many types of AmEx cards around. I get charged on mine.