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Apr 9, 2010
Banks can't stand between client and spa
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I REFER to reports about the closure of beauty chain Wax in the City.
Banks merely facilitate payment transactions between cardholders and merchants. The agreement with regard to the supply of goods and services purchased is a commercial arrangement between the cardholders and the merchants.
In other words, issuing banks and acquiring banks are only 'processors' of a transaction. It would be inappropriate to hold the banks responsible for deficiencies in the delivery of goods and services by the merchants. This should solely be the responsibility of the merchants and, in the event of default, should be addressed through legal remedy.
Making charge-backs mandatory does not address the fundamental issue of customers willingly and under no duress signing up for product offerings.
It has been suggested that banks should not approve the full package payments to businesses like spas, but allow them to deduct payment only on an instalment or when-treated basis'. As they are processors of a transaction, it is not practicable or within the scope of the issuing and/or acquiring banks to ascertain the schedule of consumption between each merchant and the cardholder.
We commend the Spa and Wellness Association's initiative to have its members insured together. Customers will be assured they are dealing with credible merchants.
Ong-Ang Ai Boon (Mrs)
Director
Association of Banks, Singapore
Banks can't stand between client and spa
<!-- by line --><!-- end by line -->
<!-- end left side bar --><!-- story content : start -->
I REFER to reports about the closure of beauty chain Wax in the City.
Banks merely facilitate payment transactions between cardholders and merchants. The agreement with regard to the supply of goods and services purchased is a commercial arrangement between the cardholders and the merchants.
In other words, issuing banks and acquiring banks are only 'processors' of a transaction. It would be inappropriate to hold the banks responsible for deficiencies in the delivery of goods and services by the merchants. This should solely be the responsibility of the merchants and, in the event of default, should be addressed through legal remedy.
Making charge-backs mandatory does not address the fundamental issue of customers willingly and under no duress signing up for product offerings.
It has been suggested that banks should not approve the full package payments to businesses like spas, but allow them to deduct payment only on an instalment or when-treated basis'. As they are processors of a transaction, it is not practicable or within the scope of the issuing and/or acquiring banks to ascertain the schedule of consumption between each merchant and the cardholder.
We commend the Spa and Wellness Association's initiative to have its members insured together. Customers will be assured they are dealing with credible merchants.
Ong-Ang Ai Boon (Mrs)
Director
Association of Banks, Singapore
