Finance

MasterCard Needs Money : Charges Customers for Oversea’s USD Charges

Written by juicebox on June 27, 2008 9:43 pm EST

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The practice probably isn’t new to you, but after a transaction with istockphoto.com on my paypal account garnered a 3% foreign transaction fee, you can bet the word pissed, wasn’t any way to begin describing it.

If your looking for a reason to get mad at MasterCard, a division of the VISA empire, maybe it’s time you did.

You know that “harmless” transaction you just did on PayPal? Apparently, it went through their canadian servers. You think, no problem, I was charged in USD.

Now MasterCard has decided to begin charging customers a record 3% for any Foreign Transactions. It doesn’t matter whether it was in USD or in any other currency (although currency conversion is extra).

For many, you might think 3%, big deal? Well, consider this. For every $100 dollars, that’s $3 dollars that could be spent on something else. Now, speaking with me, I usually spend $2,500 - $3,000 a year through my PayPal account. Now that 3% has turned into $25 - $30 dollars. I could of gone out to a nice restaurant with that money, but instead MasterCard’s executives need a new Ferrari.

If this isn’t a blatant example of corporate greed in our banking system starting to get a bit out of control, then let’s take a look at WaMU’s latest shot at customers.

WaMU “We Don’t Nickel and Dime You”… Much.

Washington Mutual has been well known for years for being the bank who championed fee’s and had some of the best banking services around the country, now they are scrambling for ways to recover in deceitful mortgage practices.

For a company that promises’ not to nickel and dime me, the recent subprime mortgage crisis made them change their tune. For the first time, i’m now being charged by WaMU 3% (do we see a pattern here?) for ATM Transactions from another bank. As if I wasn’t charged enough with that $4 charge from that petty ATM owner, now my bank, Washington Mutual wants a piece of the action as well.

After all, it’s my fault that they decided to give that family a mortgage they can’t afford. It’s not like it’s their responsibility to be sensible and responsible. Then of course when it all goes downhill, no worries! The Fed will protect their shareholders.

Honestly, this is getting bloody ridiculous. At what point will there be responsibility in Corporate America for things like these? You can’t be fiscally responsible when cutting at the bottom, while growing at the top, that’s just waiting for a downfall you can’t avoid.

While WaMU’s recent fees really grind my gears, they are still a pretty good bank, for now. However what they do with a family member of mine’s craptastic mortage (which wasn’t underwritten by WaMU, just purchased) will really reflect how I feel about the institution.

Until that time, the WaMU executive board needs a 70% paycut for their irresponsible practices, if not a complete rollover to new management, and they need to return to the values, that made them one of the fastest growing banks in the Country.

In Conclusion

I fear our American banking system is going to turn into a mafia-style system really soon, unless stricter hold is put on them. Imagine being charged a percentage to do anything at your bank. Process a check, Talk to a teller, withdrawl cash… Pretty soon, the executives will own a small country, and we’ll all be broke, on the side of the street, begging these same executives to give us money.

You would think, a digital signal from the US to Canada would be nothing, but apparently that’s not the case. Sometimes writing a check is cheaper, which in a more-paperless, digital society where the lack of paper makes for more efficient workflow, makes no sense to me. Maybe too many people in the middle, and a lack of proper oversight.

I leave you with this critical, golden gem of information about business. A business develops for one reason. To make a change. To innovate, to be someone different. When a business stops focusing on that, and focuses on profits, projections, and investors, they begin to collapse. No great American company has survived in long-term on a profit driven strategy.

Has your bank started “nickel and diming” you? I want to hear about it!

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