3 On Your Side: Paying To Pay
PHILADELPHIA (CBS) -- How do you pay your bills each month? Do you mail in a check? Or maybe you have the money taken directly out of your accounts? Well what would you do if a company charged you an extra fee to process your payment? Believe it or not, as 3-On Your Side Consumer Reporter Jim Donovan found, it's happening more and more.
Jessica Aguiar was shocked when her mortgage company wanted her to shell out an extra $20 to take her monthly payment over the phone. She says, "If they're charging me to speak to a customer service representative that I'm already speaking with, I think that's ridiculous."
It's referred to as "paying to pay."
These days banks, utilities, phone and cable companies are hitting customers with fees ranging from $1.99 to $25 for paying over the phone or for using the company's site to pay online.
Ed Mierzwinski of the consumer watchdog U.S. Public Interest Research Group or USPIRG says, "It's just unacceptable that businesses charge you a fee for the privilege of paying for the service that you're already paying for."
Unacceptable, maybe, but it is legal for most companies to charge you to pay by phone or online.
However, when it comes to credit card companies, it's illegal to charge a fee for paying unless you're close to you due date and are asking a customer service rep for an "expedited" payment.
Nessa Feddis from the American Bankers Association says, "Under the law, they can charge a fee if it's for an immediate posting or an almost immediate posting and there's a customer representative involved."
The American Bankers Association says the fee covers the cost of covering business.
According to Feddis, "The fees intended to help cover the cost of the workers wages and benefits. Frankly $10 doesn't sound like a lot when you think about how you know it's probably 10 or 15 minutes for that customer rep."
Consumer advocates balk and say most businesses and credit card companies have reps on duty 24/7, so paying a bill shouldn't cost more.
Mierzwinski says, "The banks already had those people working on the phones and if they're not collecting payments, they're trying to sell something else."
So how can you avoid paying to pay? Pay early with a check or directly online through your bank's bill pay service. That way you don't have to enlist extra help or fees for a last minute payment.
By the way, if you feel you were wrongly charged a fee by your credit card company, file a complaint with your state banking department.
Reported By: Jim Donovan, CBS 3
