Retailers defend decision to charge fees on pay-as-you-go
19 August 2014
Retailers have come under fire after it emerged that some had decided to charge a fee on pay-as-you-go electricity and gas transactions.
Retailers have long bemoaned the fact that these add on services like bill pay and toll charge transactions are actually costing them money yet they feel the need to have them in store as footfall-drivers.
The issue was raised when The Money Advice and Budgeting Service revealed that virtually all shops in a poor Dublin suburb were imposing a surcharge of as much as 10% on the service that was set up to help households reduce arrears on utility bills.
At least 150,000 households top up energy cards several times a month, mostly in a government-backed push to reduce the rate of disconnections. However, MABS found that seven out of nine shops in a poor Dublin suburb were imposing a 20 to 50 cent surcharge on each transaction.
Airtricity described it as a “completely unacceptable practice” by “a small minority of retailers” while Electric Ireland and Bord Gáis Energy expressed strong opposition. Musgrave defended the actions of its retailers who decide to add on a surcharge stating that Centra and SuprValu customers are well warned of any extra charges with signs displayed in store.
A Dublin city-centre retailer told ShelfLife that they have decided not to impose a surcharge but didn’t blame retailers who decided to do it. “The retailers and the customer are suffering here. The provider of the service is getting away lightly. However I don’t believe the way to get around it is by adding a surcharge onto the products. I don’t want my customer to suffer because the utility companies won’t increase margins.”
RGDATA, the representative association for the owners of independent shops, convenience stores and supermarkets today called on utility companies like ESB and Bord Gais and Local Authorities to properly reimburse retailers for providing pay-as-you-go services in local shops. Tara Buckley, director general of RGDATA said: “Our members are community retailers who are trying to provide convenient services for their customers. However our members will not survive in business if they provide services at a loss. This will close local shops and put their staff out of jobs. It is time that these large state companies like the ESB and Bord Gais addressed this issue and started reimbursing retailers fairly to cover the cost of providing this convenient service to their customers”.