Can the dealership charge me 2% extra for service, if I pay via credit card?

3rdAttempt · 2nd October 2023, 16:51

I am about to buy a new premium SUV & went through this 2% experience when I recently bought a Skoda Kushaq.
I have made it part of my negotiations early on to allow for a large credit card payment towards the down payment of the car.
The dealership, JLR in this case, say that their management has instructed them not to take over 5L via credit card. They say it's not because of the MDR but because of "company policy"!

I've asked them to help me understand if the reason is anything other than MDR - I am pretty certain it cannot be anything else.

In today's era, I think companies should absorb the MDR. Banks are willing to negotiate lower rates - at one point, Canara Bank was charging a 0.47% MDR + GST on payment of Income Tax while other like HDFC charge 0.85%.

For an auto dealer, I would imagine it would be fair game to negotiate down the MDRs with their banks and then allow a customer the convenience of paying whatever they want via their card.

Thoughts?

vikramv4u · 8th October 2023, 07:49

I just bought a Carens and my experience was that, yes, i was charged extra! They were charging me 1.5% additional. Negotiated a little bit (Rs. 3K lesser).. but then as fate would have it, there were some issues with the credit card machine/ limits etc. multiple issues and in that moment of tension (and pressure that the dealership was exerting on me for payment coz they were almost shutting down for the day), I decided to make a UPI payment (albeit thru my RuPay CC)... As soon as I made Rs. 1L payment the dealership received it, but they clearly got hit by charges from Freecharge -- Rs. 2500 -- basically 2.5% straight and he conveniently passed it on to me.. they would not budge from that..

Net net, initial negotiation of Rs. 3K still ended up paying close to 2.5K, so not much gain

jotemh · 17th October 2023, 20:17

I recently bought a Volkswagen Virtus from PPS motors Hyderabad. When I enquired about payment through credit card (about 1 Lakh), they said I have to pay 2 to 2.5% charges. They mentioned they’ll charge for debit card also, but a bit less.

It’s been 20days since the vehicle delivery. Now I want to get the extended warranty. When I called the SA, they are again insisting on changing 2% extra for credit card payment.

2nd October 2023, 16:51	#61
3rdAttempt Newbie Join Date: Oct 2022 Location: Mumbai Posts: 16 Thanked: 32 Times	Re: Can the dealership charge me 2% extra for service, if I pay via credit card? I am about to buy a new premium SUV & went through this 2% experience when I recently bought a Skoda Kushaq. I have made it part of my negotiations early on to allow for a large credit card payment towards the down payment of the car. The dealership, JLR in this case, say that their management has instructed them not to take over 5L via credit card. They say it's not because of the MDR but because of "company policy"! I've asked them to help me understand if the reason is anything other than MDR - I am pretty certain it cannot be anything else. In today's era, I think companies should absorb the MDR. Banks are willing to negotiate lower rates - at one point, Canara Bank was charging a 0.47% MDR + GST on payment of Income Tax while other like HDFC charge 0.85%. For an auto dealer, I would imagine it would be fair game to negotiate down the MDRs with their banks and then allow a customer the convenience of paying whatever they want via their card. Thoughts?
	() Thanks

8th October 2023, 07:49	#62
vikramv4u BHPian Join Date: Dec 2008 Location: Bengaluru Posts: 81 Thanked: 80 Times	Re: Can the dealership charge me 2% extra for service, if I pay via credit card? I just bought a Carens and my experience was that, yes, i was charged extra! They were charging me 1.5% additional. Negotiated a little bit (Rs. 3K lesser).. but then as fate would have it, there were some issues with the credit card machine/ limits etc. multiple issues and in that moment of tension (and pressure that the dealership was exerting on me for payment coz they were almost shutting down for the day), I decided to make a UPI payment (albeit thru my RuPay CC)... As soon as I made Rs. 1L payment the dealership received it, but they clearly got hit by charges from Freecharge -- Rs. 2500 -- basically 2.5% straight and he conveniently passed it on to me.. they would not budge from that.. Net net, initial negotiation of Rs. 3K still ended up paying close to 2.5K, so not much gain
	() Thanks

17th October 2023, 20:17	#63
jotemh Newbie Join Date: Aug 2023 Location: Hyderabad Posts: 3 Thanked: 4 Times	Re: Can the dealership charge me 2% extra for service, if I pay via credit card? I recently bought a Volkswagen Virtus from PPS motors Hyderabad. When I enquired about payment through credit card (about 1 Lakh), they said I have to pay 2 to 2.5% charges. They mentioned they’ll charge for debit card also, but a bit less. It’s been 20days since the vehicle delivery. Now I want to get the extended warranty. When I called the SA, they are again insisting on changing 2% extra for credit card payment.
	() Thanks