In the U.S., airlines don’t typically charge a fee for using a credit or debit card to purchase a ticket. (Allegiant is an exception, by charging a $14.99 “convenience fee” for online bookings with credit card payment. Other U.S. airlines have tried, but failed thusfar.)

In Europe, a credit card fee is more of a norm. But Ryanair, which has been charging a fee for years, was just slapped down by the German courts for charging the fee:

Germany’s federal court of justice found yesterday that Ryanair placed consumers at a “disproportionate disadvantage” by offering no way to pay for flights without incurring a fee.

“By charging the fee is shifting in a one-sided manner on to customers the costs of fulfilling its own legal obligations … without bringing any service in return,” said the court, a practice at odds with German law.

The case against Ryanair was brought by Germany’s leading consumer organisation. It complained about the fee, which ranges from €1.50 to €4 per flight and passenger.

By not accepting cash payments, it argued, Ryanair offered customers no opportunity to pay for flights without paying extra.

I can understand the motivation behind this fee: Merchants accepting credit cards give up a piece of each transaction to the credit card processing bank. (The percentage varies according to card brand and total transaction size.) But there are rules to which merchants are required to adhere. I couldn’t find a European merchant agreement. But in the US, for example: “Visa merchants are not permitted to establish minimum transaction amounts, even on sale items. They also are not permitted to charge a surcharge fee when you use your Visa card.”

It will be interesting to see if other European countries see similar cases. Credit card fees aren’t limited to Germany, after all.

pixel German courts take a stand against airline credit card fees
Categorized in: airlines, credit cards

12 Responses to “German courts take a stand against airline credit card fees”

  1. Lewyintheuk Says:

    In the UK most of the cheap airlines get around this by waiving the transaction fee if paid by the rarely used Visa Electron card. There are now online payment systems that mimic this card and gives travellers an easy way to avoid the charge. However, Ryanair has recently changing their requirement to a Prepaid Mastercard which is relatively easy to get online, but typically has fees attached to applying, topping up and using the card. It is an awfully sneaky system that is encouraging me to take trains and ferries more and more.

  2. Kyle Duarte Says:

    In France, the Minister of the Economy, Industry, and Employment has ruled that merchants can set minimums for card transactions (which must be clearly posted), but that they cannot otherwise refuse a card ( The statement doesn’t mention surcharges for card use, but I view the card industry as being younger in France than in the US and the UK, so these rules might not yet have been considered by the Minister.

  3. Brian A. Says:

    You need to look at this from their perspective…Germans are not big credit card users. I work for a big German company and spend several weeks a year over there. Culturally, they are very inclined to pay for things with cash and only use credit for big purchases…or occasions where it is absolutely necessary (i.e. making a hotel reservation…but I wouldn’t be surprised if they paid cash upon checking out). It is perhaps like the US was about 50-60 years ago. They do have debit cards and easy bank transfers which allow them to perform electronic transactions without using credit. Ultimately, they have more of a “pay only when you can afford it” mentality than the US or UK. They were quite aghast at the US mortgage crisis and Wall Street bailout, observing that people were being rewarded for living beyond their means…but now, of course, they’ve had to swallow some of that pride to pay for the Greeks.

    So, in summary, it would be very insulting for a German to be forced to use a credit card when there is no cash option and then pay a fee for that “privilege”.

  4. Jon K Says:

    Maybe someone should take aim at the US carriers that charge a telephone sales fee for making a mileage award that cannot be booked online. For example, an American Airlines award including any of their partners.

  5. RW Says:

    You shold see what they rape of passengers in the new Nanny State, Australia. Qantass, Virgin not so Blue. It’s laughable the charges for credit cards. The same applies, if you pay with cash at a branch theirs a service fee, if you pay online there’s a surcharge. Yo have no bloody choice but to pay their stinking fees and charges. Australia is the laughing stock of the world as the great big new Nanny State.

  6. Oliver Says:

    Very nice summer, Brian. Would be interesting to compare the average credit card debt and default rate of various countries (but of course, that’s off topic for this thread).

  7. Oliver Says:

    Argh, summary, not summer.

  8. funnoy Says:

    Yes this has been hidden news here in GB now for a week, since last thursday.
    Not a single newspaper or TV channel has said anything about this: typicall UK, the worst country for news in europe. Why? Because we are dictated by the moneymakers.
    Its been a great decision to stop companies from exploiting this online charging loophole, lets spread it round the world.

  9. funnoy Says:

    So, the OFT in Britain said : Ryanair is purile and childish, after they found out, that the VZBV( German OFT) took ryanair to court in Germany. But the VZBV took ryanair to court and won. Why cant the OFT take ryanair to court??? British Law???

  10. miumiu zoo Says:

    Should I be surprised that you haven’t updated for like more than two weeks?

  11. rich@farm and cottage holidays Says:

    I just don’t appreciate the lack of transparency and ryanair treating their customers like idiots. Even if you throw in all the extra charges the fares are still pretty compeitive so why breed all this resentment with underhand tactics.

  12. Charles Says:

    Funny how from what I just read, that people feel it is good that in America most airlines don’t charge a fee for using credit/debit cards as payment. The sad fact is though that all airlines operating in the USA that I have flown with, wont allow foreign credit cards to be used. That is they state explicitly that unless the card is issued in either the United states of America or Canada then it cant be done online (internet). I tried all three credit cards I have with me (one being a travelex cash passport) US dollars card. I have to phone or goto the booking desk and then they charge me 25 dollars to make the booking. Internet booking does not incur this extra charge.

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