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BA moves credit card fee to a flat 1% ….. as Virgin Atlantic scraps them

According to reports in Business Traveller, British Airways is changing the way it calculates credit card fees on bookings from 14th December.

The current charge is a flat fee of £5 per booking, with no fee on award bookings or when debit cards are used.  This is obviously unattractive on low value bookings, although in those scenarios you would presumably have no liquidity problem if you used a debit card anyway.

The new structure is a flat percentage rate of 1%.  This is obviously attractive for a £39 one-way economy flight to Manchester, but a nightmare for anyone paying for a number of premium tickets.

Whilst the card fee is capped at £20, this is per ticket and not per booking, so a family of four could still be faced with an £80 bill for four Club World tickets.

It is hard to claim that the new structure is ‘unfair’.  I would only point out you are more likely to put an expensive ticket on a credit card and may not have the option of using a debit card if you do not have the money immediately available.

There does not appear to be any discount for British Airways credit card holders.

It is not clear if the fee will continue to be waived for anyone who states that their credit card is registered outside the UK.

BA Premium Plus Amex

Whilst Virgin scraps their card fee …..

It is possible that British Airways chose to do this because Virgin Atlantic has always had a similar – higher, actually, at 1.5% – card pricing structure.

However, with great timing, Virgin Atlantic dropped all credit card fees when it relaunched its website last weekend.

Whether this survives now that British Airways is charging up to £20 per ticket remains to be seen.

(Want to earn more miles and points from credit cards?  Click here to visit our dedicated airline and hotel travel credit cards page or use the ‘Credit Cards Update’ link in the menu bar at the top of the page.)

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Comments

  1. Pay by debit card, no problem.

    • And lose S75 protection. I always pay by credit card now since I lost out with Malev…

      • This is a very important point. Section 75 protection (only available on a credit card) clinches the deal for me. But I agree this is not an attractive ‘feature’, especially for those of us paying an annual fee for a BA-branded Amex. I’d expect them to make an exception for BA card holders and waive all credit card fees accordingly.

    • I`m not sure I follow Harry. Let`s put some numbers to the example. If I buy GBP1,000 flight and
      1) Pay by BAPP, I earn 1,500 avios (say at 1p ea = GBP15) but pay GBP10 for the privilege, but Im up net GBP5.
      2) Pay by debit card, I earn nothing extra but it costs me nothing extra, Ì^m flat.
      Where does the 2% come from?

  2. I have always thought that charging the credit card booking fee was slightly unreasonable especially if I am paying via their own co-branded credit card. Now 1% fee is just ridiculous. I am getting more and more put off by BA tbh… Have been loyal for quite some time but now seriously considering other options.

    • Billy Buzzjet says:

      So just to recap……this year has seen reduced catering in club world, reduced baggage allowance in club world and now an increased credit card fee that will easily hit the majority of club passengers. Let’s add all of this to the ridiculous fee to reserve a seat (if you don’t have status) then the BA business class product truly is very hard to beat. Oh dear. What next…….

      • It is only increased credit card fees when spending more than £500 per ticket.

        • …which will affect anybody flying Club World (even on a redemption ticket with £500+ taxes.charges etc). Corporate accounts may not care, but I’m spending my own money..

          As for expecting them to waive the fee when using BA AmEx, they seem to have decided it’s cheaper to throw15K (devalued) Avios at those of us who.ve held the card for 15 years!

      • trickster says:

        I wouldn’t say it affects the majority of club passengers, as these would be on corporate bookings.

      • I nearly forgot about the fee to reserve a seat! It’s diabolical. They want to charge me £90+ to reserve a half decent club world seat from LHR to HKG and what’s worse, I feel like I should empty my pockets because the discrepancies in terms of privacy / comfort of different CW seats are huge, but at the same time quite unwilling to give BA any more of my money given the recent changes (for the worse).

        I think I would have felt better though if they price in the £90 in my ticket price and let me choose my seat at the time of purchase.

      • And removal of service on UK connecting flights for Club World/First pax…

    • Eva – Ive just read some of your blog and I loved the writing style. Hope you continue to enjoy living in London…

  3. O/T I have some Iberia miles I want to transfer to BA. I opened the account on 15th August 2016, so more than 90 days old but I am not being offered the option to transfer from Iberia to BA just the other way around on the Iberia site, any suggestions?

  4. Cheshire Pete says:

    Rob you say there is “currently” no fee on redemption bookings, are you implying we will now have to pay the 1% on these too?

  5. The slaps in the face just keep coming!
    Ive only just got the BAPP card – it will definitely be cancelled when I get the 241.
    Ive only been into the points collecting lark for 2 or 3 years and, clearly i’ve missed the boat (or plane) but is there any point any more?
    – The US is the place to live to collect miles,
    – I don’t fly for work,
    – Avios devaluation, (a nice welcome for me!)
    – AA tier points reduction (I was planning a trip to get TPs)
    – I decided to put all eggs in the BA basket, the only choice in the UK really.
    – The huge UK air passenger duty
    – Status match offers often bar UK residents
    I might just go back to finding the cheapest option possible – the reward for loyalty is becoming a struggle!
    I could go on, but rant over for now, I need a holiday…

    • I agree, I got into it at a similar time and although I’ve done alright out of it, it has been kick after kick and I’m starting to lose the excitement. I even couldn’t be bothered to scan my clubcard (never mind the credit card) when I filled up yesterday! :/

    • Just to clarify, whilst the USA is clearly the best place, it’s not the only place.
      I just spent a year in Australia and that is how I got into collecting miles seriously.
      In 6 months I was able to get 183k Qantas miles and 300k Virgin Australia miles… as a result I managed to use those virgin australia miles to book singapore suites from europe to seoul and return back in singapore business

      Just that reward alone has been enough for me, as all my travel is self paid in economy, to make this hobby worthwhile!

      so drop BA (always been pathetic anyway) and move to get some sunshine in australia 😉

      • Nick Anon says:

        Ha ha yes whilst moving to Australia would be fantastic, I couldn’t justify it on the reason of chasing points alone! Mrs Anon may disagree though…

    • I wouldn’t say the US is the best place depending on who you fly with, if you fly with EK or EY, you can earn significant milage through debit cards issued in Dubai before you even get to credit cards and their sign up bonuses.

      Then there is Australia and Canada which follow a similar practice to the US with credit cards and bonuses.

      You putting all your eggs in BAEC is a silly move, you still had VS and EU airlines (earnings on AMEX) as well as EK and EY (both offer credit cards in UK). I fly LH and earnt miles on the German M&M card which anyone can apply for (German residency isn’t required), there are ways around all programmes and how to get what you want. BAEC is easiest but not the only option.

      • Nick Anon says:

        I agree that there are other options, indeed myself and Mrs Anon are flying to Vietnam in business on Etihad and the Amex Etihad card + Amex Plat signup bonuses help pay for it.
        My point relating to the above article is, everything I read says that it used to be so much better, and that it keeps getting worse – especially in the UK.
        With just one ‘big’ trip every other year and a handful of European (ish) flights every year is there actually a way of earning status? If I don’t commit to BA’s tier points surely I would have to commit to one other EU airline? I’m happy to do mileage runs, and being self employed I can sneak off anytime…!

        • Airline programmes are getting worse but I wouldn’t say that BAEC is as bad as claim, BA itself is dreadful and I refuse to step foot on a flight but BAEC is good overall.

          I would say that the cutbacks and changes are just because of the new boss coming from a LCC.

          You can join any programme but if I were starting again I would go with BAEC, I am with M&M and if you are just starting and only do a handful of flights you’re buggered for status.

          That said if I were doing long haul and EU flights I would look at Etihad Guest and the EU partnerships as for miles and tier points earning, it is quite sustainable IMO.

        • the real harry says:

          I just don’t get your logic (forgive me!)

          where in the article above does it suggest that things were so much better in the past?

          • Apologies, I didn’t mean that. I meant in general things were better before, and the article is describing another bit of bad news for us points collector folks!

    • The UK has some awesome opportunities,
      – Tesco points are still an excellent way to generate avois/virgin
      – the BAPP 2-4-1 remains outstanding value for long haul first to places like HKH and SFO
      – Amex plat can generate 200,000 MR’s per year per couple through churning.
      – SPG to Marriott opportunity is new
      – arguably it’s far easier recently to status match hotel chains than ever before

      The game is always changing all the time but real opportunities definitely exist.

      • “Amex plat can generate 200,000 MR’s per year per couple through churning”
        This is one of the biggest benefits of the UK over USA. My understanding is that amex USA does not allow churning (correct me if I am wrong) – that is somewhat balanced by having higher signup bonuses, but still without churning things are a lot harder.

  6. When you pay by Amex, if you choose the billing country to be any other country than UK, then there’s no surcharge, and the payment would go through as long as other parts of the billing address are correct. I’ve done this many times, and there wasn’t any problem for BA to refund me after I claiming the price guarantee.

    • But doesn’t that mean you get charges in a non-£ sterling currency?

      • No

      • the real harry says:

        No. You only get charged in a foreign currency when you book (say) a 1-way originating in a non-UK country. Not sure if there is a way round this.

        But if you live in Ukraine and book to fly out of UK, it’s in GBP

      • No because you’re on UK site and the price was quoted in GBP already. Even you really use a card issued in America say, you’re still paying in GBP. Btw I don’t think there was any surcharge at all when I purchased a single ticket from Europe to UK which was priced in EUR.

    • Shhh 😉

  7. If you’re not claiming a 241 or similar offer, booking your flights via the Amex travel site saves the credit card fees altogether. Use an Amex Gold and you are laughing with tripple points!! :)

    • the real harry says:

      drawback being it’s T-330 not T-355

    • Cheshire Pete says:

      Not checked with a recent BA flight, but I used to also book via Amex travel for my KLM flights as they charge £5 also on KLM.com. So used to save this booking with Amex. But noticed the other month the prices via Amex travel now rolled in the £5 you used to pay on KLM.com so a loophole closed down there! Not done a dummy BA booking to check if it’s spread yet.

  8. £195 now for the BAPP, now 1% on top, I thought BA would be looking to increase business not drive it in to the ground. I phoned BA last week and paid for our Tallinn flights and asked why BA charged their own customers, with their own credit cards a £5 per ticket fee. The guy doing the ticketing said he didn’t know, but lots of people moan/mention it, this isn’t going to help. Do other airlines do this e.g. Finnair, as in this case I could have booked through them. Should I be looking elsewhere other then BA to book (where possible)?

  9. Lewis Watson says:

    Even Ryan air doesn’t charge when you use there own branded card

  10. OT;

    Just got email from The TIMES, saying there is a delay in posting avios from subs, they are ‘ working hard with our partners’ to get it sorted.

    Fair play for reaching out, atlas they have not forgotten about it.

  11. I flew from LHR to AMS this morning to connect to an ex EU J class flight with Qatar. On the BA flight I overheard an interesting conversation between a BA gold card holder and a long serving stewardess. The Gold card holder was bemoaning the fall in standards and penny pinching. The stewardess was very sympathetic and saying the reductions in service are really being commented on by frequent flyers and gold card holders and as a result staff morale is low with staff viewing Cruz’s short term drive for profit as a long term disaster in the making as passengers vote with their feet.

  12. I have to agree with the negative sentiment. You can’t ignore the declining benefits. The triple issues are too obvious: Avios devaluations, Amex handling fees and annual fees, and the generally declining ambitions of BA to be a first class carrier are all gloom. On the other hand, the Middle East carriers and maybe to some extent Virgin, who cover a lot of popular routes, do a great job (most of all, try Ethiad!). It seems to me they are more conscious of travellers’ expectations. They deserve the business. I don’t feel like that about BA.

    • the real harry says:

      apart from loss of free F&booze, the situation in Europe is pretty good for people not willing to pay CE (me!)

      The only other recent negative afaiac is the small loss in mileage Avios (75% devaluation ISTR) – but they were a tiny % of the Avios we earn because most of our trips are redemptions.

      Vs LCCs, cash tickets are amazing cheap in HBO & competitive in Standard (ie with luggage). Provided you can buy tickets ahead of time, of course.

      It’s easy to get the seats you want, for free, with a few tricks – and families can therefore sit together.

      I’m still very annoyed at the loss of free F&booze on tickets I bought ahead where free F&booze was advertised as part of the deal – still contemplating my position. But going forward (new bookings) – not a major issue.

  13. OT/ Was refused the 15 quid allowance at the T5C Starbucks today, did BA scrap this benefit for silver members?

  14. I always thought it was ridiculous that BA didn’t waive the fee for BA Amex holders, but to now increase the fee dramatically is just insanity. Ok so the travel/holiday industry seems addicted to credit card fees, but surely for their own card holders they shouldn’t be charging this.

    Crazy!

    • the real harry says:

      they’re drastically reducing the fee for most people, I think you’ll find

      work out the % of tickets that cost less than £500 vs those that are £500+

  15. the real harry says:
  16. Is 1% really a problem if paying with a BA AMEX as you get double avios anyway?
    Ok, your effectively buying AvIos! but at least its not ‘dead’ money

  17. I have been saying this for a while but it was hard to dump BA when I was living in London. The convenience of taking direct flights was too convenient. However, now that I live in the bay area, it isn’t hard for me to dump BA and/or even trying to chase status with any airline for that matter. I have Amex Plat which gets me into a goodly number of lounges. I can find the cheapest business class flight which often tends to be a pretty decent airline. Most airlines have a better business class seat than BA anyway. If I do have business class tickets, I can get into their lounges. Within the US though,, the airline lounges so crappy that I don’t really care for them anymore. It is worthwhile to buy a cheaper ticket somewhere and spend the money you save on a decent meal/drink at the airport. When I need peace and quiet, I will use one of the Amex or priority pass lounges. This is actually quite liberating. So dear British Airways, once I use up my 2-4-1 voucher, I will have to part ways with you and let you convince me to fly with you again. I don’t suppose you (BA) care much either way but your loss is someone else’ again.

    • To maximise Amex Reward Points (assuming 2 people and min spends can be achieved in a week).

      I am trying to map this in Excel and I wonder whether the best strategy needs you to refer and cancel ASAP or to keep open a while ?

      Person 1 referral for Plat by 3rd party = 35000

      Person 1 refers Person 2 for Plat = 18000
      Person 2 receives referral from Person 1 for Plat = 35000
      Person 1 refers Person 2 for Gold = 9000
      Person 2 receives referral from Person 1 for Gold = 22000
      Person 2 refers person 1 for Gold = 9000
      Person 1 receives referral from Person 2 for Gold = 22000

      Person 2 refers Person 1 for Plat = 18000
      Person 1 receives referral from Person 2 for Plat = 35000
      Person 2 refers Person 1 for Gold = 9000
      Person 1 receives referral from Person 2 for Gold = 22000
      Person 1 refers person 2 for Gold = 9000
      Person 2 receives referral from Person 1 for Gold = 22000

      Assuming a quick referral you only need your Platinum open long enough to refer your other half for a Platinum and Gold and receive your rewards don’t you ? Perhaps only a month or two ?

      Person 1 referral for BAPP by 3rd party = 9000

      Person 1 refers Person 2 for BAPP = 9000
      Person 2 receives referral from Person 1 for BAPP = 26000
      Person 2 refers Person 1 for BAPP = 9000
      Person 1 receives referral from Person 2 for BAPP = 26000

      So is the maximum theoretical per “cycle” 230,000 MR points and 70,000 Avios ?

      If you open in Month 1 and refer and receive in Month 2 then cancel in Month 3 then you can re-apply in Month 9 I assume, making a theoretical 4 cycles in 3 years ?

      As you would have times when you were without an Amex MR card, you would presumably either have to stagger the Plat / Gold applications to overlap ?

      What about the business Plat card with 45k ? Can you churn that to get extra MR ?

      • Platinum annual memberships I thought were now non refundable, so you pay the entire years fee, if this is still correct your paying £900.

      • You can’t get a bonus on a business card if you have a personal card.

        • So no bonus on any business card if you have any personal card ?

          But swapping out the plat personal for the plat business would add 10k to each application I guess or 20k per cycle.

          However, further thinking it out, if you want to benefit from the continual referrer’s bonus for platinum, one of you would need to have a plat card all the time as you cannot refer for a platinum from any “lower” card. Whether that extra 18/36k is worth the additional pro rata fee I don’t know as I haven’t yet finalised an application / cancellation / re-apply timetable.

          I just feel we are missing out when loyalty to 2 x BAPP is wearing thin.

          The question still remains though where to put the majority of Amex spending – circa £150k per annum ? Even these account requirements would only suck up £20/30k of that. At the moment it goes into BAPP but I wonder whether a hotel points card might be better value given I was able to pick up Etihad business on LHR-BKK for £1166 the other week.

      • I didn’t think you could mix the Plat and Gold like this – my understanding was that you had to leave six months between them. Happy to be told that I’m wrong – it will give me another source for MR points.

  18. So if you are playing with Plat then you never bother with Gold as the bonus is less ? If you need 6 months between holding either Plat or Gold, then why apply for Gold instead of Plat ?

    And if you can churn the business Plat, why bother with the regular Plat as the business bonus is 45k – assuming there is a referral for the business card ? If not then I understand the logic for using the regular Plat.

    How do you keep the MR points open if you are closing the accounts so often ?

    • Therein lies the rub! (W Shakespeare acknowledged).
      When you close the account you have to do something with the MR points. You can transfer them to another MR earning but you can only have one at a time so you will have to convert them to airline, hotel etc. points at each cancellation.

    • Opening a business card is more bother (Amex requires proof of your business, potentially including accounts) and the spend target is higher, at least on Plat.

  19. I think this is the right thing to do. The previous system whereby the high percentage fee paid by cheap ticket buyers subsidised a low percentage fee paid by expensive ticket buyers fell foul of the Consumer Rights (Payment Surcharges) Regulations 2012, which says “A trader must not charge consumers, in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of that means”. If BA incurs a percentage charge, then it should pass on a percentage charge, not a fixed charge with some customers subsidising others.

    • But as credit card charges have come way down and conversely debit card charges have gone up ! BA is charging way more than the cost at 1%.

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