Woolworths reducing card choice

Members – and millions of other Australian consumers – should be aware of a move by Woolworths to restrict the use of Visa Debit cards across their retail empire later this month. From 15 April, Woolworths’ outlets (which include Big W, Woolworths Supermarkets, Safeway, BWS, Dan Murphy’s, Dick Smith and Tandy) will start banning customers from selecting the ‘credit’ option when using a Visa Debit card to pay for their purchases.

Millions of Australians use Visa Debit cards to help minimise transaction fees and all Savings & Loans members currently receive unlimited free ‘credit’ purchases using their Visa Debit card. By only allowing Visa Debit card users to select ‘savings’ or ‘cheque’, Woolworths will be forcing many of its customers to pay extra to buy their groceries.

Without getting too technical, Woolworths will only process Visa Debit purchases through the EFTPOS network, of which it is a part owner. The move not only limits consumers’ choice, but also works out better financially for Woolworths.

Woolworths – one of Australia’s biggest companies – is using its market dominance to tell you how to pay for your shopping.

If you haven’t used one before, a Visa Debit card gives you all the convenience of a traditional credit card, but using your own money. This means that you can use your card to buy things online, over the phone and to buy your groceries (at least, anywhere that isn’t owned by Woolworths after 14 April). It’s a great way of giving people access to their money however they want it, without the risk of going into debt.

The ban only extends to Visa Debit cards, not credit cards. Woolworths has previously launched its own credit card, which will also not be affected by the ban.

There isn’t much we can do to change Woolworths’ decision, but there are a few ways to avoid any fees for using the ‘savings’ or ‘cheque’ option with your Visa Debit card:
• Withdraw money from a rediATM before going shopping – there are over 3,200 rediATMs around Australia
• Think ahead – if you have to use ‘savings’ or ‘cheque’, take some cash out so you don’t have to perform another transaction
• Consider taking out a Visa Credit card – this isn’t the right option for everyone but interest free periods are available and you can ‘pre-load’ the card with your own money if you’re worried about credit cards

We’re working with our industry group to help ensure that Australia’s payment system remains fair and our members can continue using their money however they want to.

Comments

[Richard McCoy]

i hope the ACCC looks into this. it seems unethical and possibly illegal. as a supporter and user of VISA Debit, i appreciate the convenience provided to be by Savings and Loans Credit Union, in giving me acess to the visa debit facilites.

[Darren]

Option 4.
Don't shop there.

[Luke]

I'll keep going to coles like usual then.

[Kathy]

Obviously the idea of people using their own money to pay bills is so archaic. Lets impose this backwards restriction and encourage people to sign up for credit cards they cant afford to pay off.

[Trevor]

As a S&L member who currently pays $2 a month for the luxury of having a Visa Debit card, which you have actively encouraged me to take out in order to enjoy "low fee" banking under your transaction allowance model, what is now your response to this and how will you compensate me for your weakened transaction fee proposition? Being a Woolies customer (they are my local supermarket) and a shareholder, are you suggesting I now switch grocery stores in order to justify the $24 I pay in fees annually just for having a Saving & Loans Visa Debit card, which seems now useless?

Kind regards

Trevor

[Tony]

Be absent minded, fill up the trolley, and forget the restriction and apologise for them to restock the goods.

[Bill]

Why should a corporate giant like woolworths have the right to tell us how to spend our money.

They are a den of theives as it is............the great big greedy monster. I shop almost weekly in dick smiths from time to time but no more now.

Wont shop in any of them

[Darrell Harris]

That strikes them off my family's shopping list! Jaycar Electronics will definitely get more business from me, along with Coles/Myer, Foodland/Drake, United Petroleum and Liberty Petroleum (just to name a few that are not Woolies owned)...

Fools!

[Kate Jones]

Coles is slightly cheaper in most cases. But there are also Foodland,IGA/Drake stores etc. I noticed the other day a Foodworks has opened in Morphett Vale - is this a 1st for SA? I haven't been in there yet but have used them in Tasmania. There are other alternative to their other outlets too. We don't have to use Woolworth owned shops people.

[Savings & Loans]

@Trevor We're not suggesting that anyone switch supermarkets or stores because of Woolworths' move, as it's a decision that individual consumers need to make. This post was to make sure that people were aware that Woolworths was removing a payment option that many consumers used, which could have a large impact on many shoppers.

Savings & Loans' fee structure has been designed to offer members a wide variety of transaction options, while rewarding those members who have trusted us with a range of products and services. The majority of our members have a number of free transactions each month. If you're a member with an Easy account, Retirement & Pension account or Platinum membership then you have unlimited transactions and won't pay for using the 'Chq' or 'Sav' options using EFTPOS.

We're in the process of designing new accounts and fee structures as a result of the merger. Making sure any changes are fair and benefit members is important to us, so it will be several months before any changes are introduced.