Businesses in the UAE are demanding answers on a new rise in credit card charges they fear could make a serious dent in their profits.
Several firms, including some of Dubai's glitziest restaurants, have told 7DAYS that from the start of this month they have had to hand over a bigger slice of any bill paid using the platinum cards favoured by wealthy customers.
They say they now have to fork over 2.25 per cent of such transactions - up around one per cent on what they previously had to pay.
That may not sound much, but angry business owners reckon that it could end up costing them tens of thousands of dirhams more per month.
"Our concern is that we have been told that premium credit cards - titanium, platinum and black - are now fixed at a 2.25 per cent rate," said Ajaz Sheikh, boss at top Dubai restaurant Zuma, who's calculated the move will cost them an extra Dhs40,000 per month.
"It's not pocket change, it's money - and it's taking away from our bottom line," insisted Sheikh.
With the vast majority of their clients well-heeled customers who carry premium cards in their wallets - high-end Dubai restaurants like Zuma, La Petite Maison and Okku have been particularly prominent in voicing consternation against the sudden increase. But swanky restaurants are not the only ones going to be hit in the pocket.
Every business - from grocery stores or high-end jewellers - where customers pay using premium cards will be hit with the additional charge each time one of them slaps a purchase on their plastic.
A source told 7DAYS that the rise has already led to some major car dealerships in the UAE refusing to accept premium credit cards - instead insisting on cash or banker's draft cheques. But wealthy patrons don't have to worry about having their plastic turned down in their favourite eatery.
La Petite Maison boss Cedric Toussaint insisted: "We can't turn around at the end of the meal and say ' we can't take that card' - it'd be embarrassing."
7DAYS has seen a letter from one UAE payment merchant informing clients of the rise, in which says it has "no choice" but to pass on the hike. Payment giant VISA says it is innocent too, saying "retailers pay a merchant fee to accept electronic payments that is negotiated with their own bank."
UAE banks remained tight-lipped on the isssue yesterday. But companies are confused - and angry - about the hike. Zuma boss Sheikh said: "Who is protecting businesses in this country?"
© 7Days 2012
