United Kingdom-based Ryanair Ltd. is giving consumers the opportunity to avoid what have become controversial airline booking fees when tickets are purchased with plastic.
Ryanair’s catch, however, is that consumers must use a cobranded prepaid debit MasterCard to escape surcharges.
Ryanair introduced the card Sept. 13 just a week after the UK’s Office of Fair Trading launched a formal investigation into airlines charging fees for credit and debit card ticket purchases.
The investigation comes after the organization proposed the country’s Treasury department could ban the surcharges with an amendment to existing payment regulations (
The Office of Fair Trading’s original proposal was preceded by a so-called super-complaint consumer group Which? filed in June. That complaint spurred the government body to take action (
Ryanair was not immediately available for comment but a spokesman told The Guardian newspaper in the UK the card’s launch had nothing to do with the Office of Fair Trading’s airline-surcharge investigation.
Consumers may temporarily avoid Ryanair’s £6 (US$9.48) surcharge on a one-way flight if they use any MasterCard prepaid card. That will change, however, on Nov. 1. Then, the only way to avoid a fee will be to use Ryanair’s Cash Passport card.
“We have suffered criticism for some time that customers do not know where to get prepaid MasterCards,” the Ryanair spokesperson told The Guardian. “So we decided that to make it easier for customers they could start getting them from our website.”
Ryanair denies charging consumers credit and debit card fees and instead labels the surcharge as an “admin fee” for website maintenance, the spokesman said.
Despite that claim, one analyst believes Ryanair’s move to a prepaid card goes against “the spirit” of what the Office of Fair Trading is trying to accomplish.
“The commission wants the airlines to avoid adding those additional charges, or at least be more transparent about them,” Zilvinas Bareisis, a senior analyst at Celent based in the UK, tells PaymentsSource.
Whether consumers embrace the new card and use it remains to be seen.
Bareisis believes the card gives frequent Ryanair travelers an advantage to avoid paying surcharges each time they travel with the airline. Ryanair also would receive more brand recognition if its customers start using the card as a frequent payment tool.
Ryanair will reimburse cardholders for the card’s £6 purchase price with a travel voucher for the same amount. As a special introductory offer for all Ryanair cardholders, there will be no transaction fees on any purchases with the card in the UK until March 31.
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