Commissioner's Blog: Spotlight on hidden fees
Every cent counts during the current cost of living crisis, so it can come as a shock to discover extra fees or charges have been added to a purchase before checkout, or tacked on to the receipt after paying.
Hidden fees may come in a number of disguises, so it’s important to know what to look for and understand your rights to avoid spending more than you’d initially planned.
Pre-selected extras are becoming more common as food delivery apps and self-service QR codes in restaurants replace ordering in-person, or when events and flights are booked online. These apps and websites can be set to automatically charge a tip or for other extras, unless the customer removes these options before paying.
Under the Australian Consumer Law (ACL), businesses are allowed to add pre-selected tips and optional charges to your bill – in a practice known as ‘drip-pricing’ – but only if the additional prices are disclosed at the beginning of the purchasing process.
To avoid accidentally leaving a tip, or being stung for other add-ons, it’s important to keep an eye out for any preselected extras included in the total price and deselect anything that’s not wanted before making payment.
If you are misled into paying an optional charge, then raise this with the business and request a pro-rata refund to the value of that added charge.
Another common issue we hear about is payment surcharges for simply using your credit, debit or EFTPOS card, rather than cash.
Card surcharges are permitted under the ACL, however the fee must only reflect what it actually costs the business to process the payment, such as bank fees or terminal costs. If a business charges a payment surcharge, it must be able to prove the costs it is based on.
Should a business not accept cash – or fail to provide another way for consumers to pay without incurring a surcharge – the fee must then be included in the total cost.
If you believe a business is breaching the rules on hidden charges, it’s best to broach it with them first. Should negotiations fail, contact Consumer Protection on 1300 30 40 54, or firstname.lastname@example.org
Commissioner for Consumer Protection
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