Meteor to reduce commission on top-ups in 09
Top-up provider Meteor has said it intends to decrease the commission paid on its products in Ireland to bring it in line with other European markets
8 July 2009
Meteor has announced through its distributing agents that it intends to reduce the commission available on its products this year. . The reduction is likely to occur in phases and it is suggested that Meteor is looking to reduce Irish commissions by 1 to 2.5%.
Chief executive of the CSNA, Vincent Jennings has slammed the move by Meteor, saying that it is arbitrarily increasing its own margin by 10% and “ripping it out of our sector, in really hard-pressed times, on a low margin product.”
The commission on top-up products for most small retailers stands at 3.5%, which Jennings describes as “a very low base.” Furthermore, he says Meteor has acted over time to devalue the product as a footfall generator by investing “extraordinary amounts” in alternative modes of distribution.
Some providers have written to customers informing them that they will not be absorbing the loss and it is widely anticipated that more will do the same. It has been reported though, that Payzone is refusing to accept the reduction and has threatened to delist Meteor. However, the provider was unavailable to comment on the matter.
Commission on top-ups in the UK are up to 50% less than in Ireland and Meteor has said it wants to move Ireland in line with other European markets. Jennings says however that Ireland “bears no resemblance” those markets, where overheads are lower and volumes are considerably higher.