Transparency: “Convenience fees in online transactions often high, transparency needed”, survey finds | India News

MUMBAI: Anyone who has ever booked online a ticket for a movie, play, music concert, train seat, and like would be familiar with the surreptitious fees that pop up just before the final payment is done. Called `convenience fees’ or `internet handling charges’, these are levied by ticket or service booking platforms for the processes involved. What is brow-raising though is the quantum of levy with some being as high as 20 percent of the transaction value.In a recent online survey, 83% of consumers said they paid the fee disapprovingly.
“When you see convenience or service charges being levied on the purchase of tickets/services, how do you proceed with the purchase or booking?”, the survey then asked. Out of the 10,960 respondents, only 10% indicated that they “happily pay, at least I don’t have to stand in a queue”; 5% prefer to stand in a queue and buy the ticket / service; but 83% “pay disapprovingly” and 2% of the respondents gave no clear response, said LocalCircles, the community-based social media platform which carried out the survey.

“What this indicates is that while most consumers are unhappy about the platforms levying a convenience fee, they are paying it because they have gone through the registration process, seat/service selection process etc. and close to concluding the transaction. Most consumers would rather have the platforms display this information upfront so they can make an informed choice,” the survey said. “A total 84% consumers said they want the government and its PSUs to stop charging convenience fee or service charges to promote Digital India,” it added.
The survey received over 32,000 responses from consumers located in 346 districts of India, with 64% respondents being men, 45% respondents from tier 1, 33% from tier 2 and 22% respondents were from tier 3, 4 and rural districts. A total of 41% consumers claimed they have been charged convenience fee for all services purchased online and 38% share they have been charged convenience fee for majority of the services purchased online, the survey said.

Sachin Taparia, founder, LocalCircles said: “When services like tickets are procured digitally, the supplier or seller is able to lower cost of manpower and facilities and instead spend more on deployment of user interfaces and backend servers. However, despite the net cost savings, most platforms whether selling movie or sports tickets, railway tickets or airline seats are levying this convenience, internet handling or service fee which is beyond comprehension for most consumers.” Adding that platforms such like BookMyShow, PVR, IRCTC or many others levy these fees.
According to a Reserve Bank of India (RBI) notification on April 21, 2022, “Convenience Fee is a fixed or pro-rata charge on use of credit/debit cards as one of the alternative forms of payment which is not ordinarily accepted vis-à-vis other forms of payment.” The notification stipulates that if convenience fee is charged on specific transactions, it “shall be indicated to the cardholder in a transparent manner, prior to the transaction”. “The fact is that despite this guideline, only a handful of portals display this information up front. This holds true even for government owned entities like IRCTC,” said Taparia.
“Another point is that most platforms also charge this convenience fee according to the number of seats booked as opposed to one fee for the entire transaction so for four movie tickets bought together in one payment transaction, the consumer pays convenience fee on each one of the four seats,” said Taparia.
In summary, the survey found that 79% of the consumers who buy services/tickets online are fed up with excessive convenience fee/service charge/internet handling fee being levied by platforms. “They feel that this excessive fee is coming in the way of Digital India and more people purchasing services/tickets online,” it added.