Visa in NZ will no longer charge currency conversion fees on refunds.
If you received a foreign currency refund on your Visa card, the company used to take a share. But Visa has now dropped this fee here following a call from Consumer NZ.
When you’re shopping online and paying by credit card, the banks take a cut on every purchase made in a foreign currency – between 1.85 and 2.5%.
However, ANZ, ASB, BNZ and Westpac Visa cardholders were also being stung by currency conversion fees on any refunds they received.
Also charged as a percentage, these fees can really add up – as one Consumer member discovered when he bought a $2151 television using an international Visa.
The retailer’s website accepted the order and money was taken from the card. But when the sales team reviewed the order, the company chose not to accept it and refunded the full payment four days later.
With his bank adding a 3% charge on the original transaction and the refund, our member was $118 out of pocket – with nothing to show for it.
Consumer NZ chief executive Sue Chetwin said international refunds were the result of a purchase gone wrong. “As the customer may not be at fault, slapping them with a fee just adds insult to injury,” she said.
Visa charged its refund-processing fee to the banks, and ANZ, ASB, BNZ and Westpac passed it on to Visa cardholders. Ms Chetwin praised Kiwibank and TSB, which had “absorbed” this charge prior to it being dropped.
If a Mastercard-holder receives a full refund on their credit or debit card, they’ll also be reimbursed the currency conversion fees on the original payment – something to keep in mind when shopping online.