Questions and Answers

Hi Ben,

I’ve got a question for you, although it’s really more food for thought.

Your pattern of credit card sign-ups and targeted spend lets you fly nearly free, notwithstanding opportunity cost and time sunk and all the other non-monetary costs. The way these companies afford these bonuses (especially Amex) is by charing the end-merchant a fee. The fee is usually around 2% for Visa and MC, and 3% for Amex.

So my question: How much do you reckon the various vendors you’ve used to put spend on your cards have spent towards your flights this year? i.e. if you earned 100,000 miles at 1pt/$ (although of course we should never settle for that!), the merchants would’ve forked out about $2K-3K.

[USER=267]@aussiejosh[/USER]

The merchants have not as you say forked out anything, they would have passed on the cost to the consumers.

If you really want to think deep thoughts you might want to consider the following; Are prices we pay for everything in the western world higher because of credit card fees?

And will there every be a push back in the form of extra fees for paying with credit cards instead of debit cards? Some of the ULLC in Europe are already do this, will other merchants outside the air industry consider follow the same model?