The price of convenience

Posted at 1:31 PM on December 30, 2011 by Bob Collins (1 Comments)
Filed under: Economy

The FCC reportedly will investigate Verizon's plan to start charging $2 to some people to pay their bills.

Verizon will start charging the fee to people who make a one-time payment online with a credit or debit card over the phone or online.

"On behalf of American consumers, we're concerned about Verizon's actions and are looking into the matter," the statement from the FCC said.

It's an obnoxious idea, of course, this notion of paying money as a convenience charge to pay money, but it's hardly new.

A few weeks ago, for example, I wrote about Ticketmaster's "convenience fees." The Twins and others charge a "convenience fee" for the convenience of using your ink, and your paper, and your Internet connection to print out their tickets, thus saving them the cost of paper, ink, and postage to send them to you.

State Farm, for example, charges me a $1 "fee" each month for the convenience of extracting about $400 automatically from my checking account, a process that occurs between banks every day for pennies.

But Verizon's plan that's drawing so much consumer outrage mirrors most closely the policy of Xcel Energy, which charges a fee if you pay the bill online. The company, however, makes clear it doesn't benefit from the transaction. It says payments go to NCO Financial Systems, a call center and collection agency.

More than likely, that's what the FCC will find is behind Verizon's convenience fee; it pays for some third party's work.

"Customers have a number of alternatives to pay their bill and not incur the convenience fee," A Verizon spokeswoman told Bloomberg this afternoon. "Paying the fee is an option, not an absolute."

Update 2:31 p.m. - Verizon says it will drop the fee.

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Comments (1)

How is it that so many businesses in this country have stopped providing us with friendly, quality service, but instead charge us additional fees for inconveniencing them by giving them our hard earned money?

When the revolution comes.......

Posted by Jim Shapiro | December 30, 2011 3:31 PM

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