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I use credit cards to pay all my recurring bills automatically, with one exception: PSE&G (electricity and gas), for one simple reason: it wasn't an option. Yesterday I saw this on their website (http://www.pseg.com/customer/home/bill/bill_overview.html):

PSE&G has contracted with Speedpay as a pilot program, to allow you to pay your PSE&G bill online using your MasterCard, Visa, or Discover credit card.

A $5.95 convenience fee will be charged to your credit card to use Speedpay. PSE&G does not receive any portion of the convenience fee.

I sent them an email, quoted below:

$5.95 "convenience" fee for Speedpay is RIDICULOUS! I pay monthly bills to
nine different companies (utilities, communications and other services), and
all are able to setup recurring credit card payments without ANY additional
fees. I am very dissatisfied with PSE&G.


Here is their lame response:

From: De Lello, Kathleen
Sent: Tuesday, July 27, 2004 1:50 PM
To: McGrane, Deborah K.
Subject: FW: PSEG customer feedback 17910

Thank you for your comments regarding the pilot program that PSE&G has
recently commenced. PSE&G decided to implement this program in response to
requests by customers to allow credit card payments. And while it may seem
unusual for a fee to be imposed for use of a credit card, the credit card
companies do impose fees to utilize their services. PSE&G has contracted
with an independent company, Speedpay, to process the credit card payments
and the fee charged by Speedpay covers the fees charged by the credit card
companies. Speedpay will impose this fee each time you utilize their
service. PSE&G does not received any portion of the fee.

I am happy to tell you that PSE&G is currently developing a program that
will allow its customers to make their payment on-line without a fee.

Thank you again for your input on the program.

Deborah McGrane

With a member name of "EugeneV" I never suspected your real name to be "Deborah K. McGrane".

Deborah K. McGrane is probably the person replying to EugeneV's email.

No the rep is called Kathleen De Lello.

Yeah, the CSR forwarded corporate officer's response.

Regarding the names...it looks like it was forwarded to a 2nd rep...

As for the fee, many utilities charge this type of fee. Why? Simple, they don't have to worry about losing customers to another competitor who does accept cc's because there are none for most gas and electricity customers. Speedpay got a sweet contract here, though.

One thing I did notice is that after AT&T was allowed to offer local telephone service in my area, SBC started taking CC's...

Isn't it illegal to charge extra fees to cover the cost? Maybe you should forward that email to Visa/Mastercard and let them decide if it's in violation of their TOS.

Thanks, clutz.
I used your post in my response to PSE&G:
--

Hello and thank you for your prompt reply.

I am certainly aware that the credit card companies impose fees to utilize their services. Credit card companies also ban merchants from passing those fees on to the customers. Using a third party credit card processing company seems like it is the only loophole. For some reason, however, PSE&G is the only service provider billing me monthly reverting to such strategy. It is hard to believe that while most "mom & pop" grocery stores managed to arrange credit card processing years ago, it is such a challenge for PSE&G. I suspect it is more a matter of the company's lack of vision, lack of competition and being out of touch with the time. Speedpay got a sweet contract here, though, and I would not rule out corruption, pardon my paranoia.

[sentense removed - EV] As soon as AT&T was allowed to offer local telephone service, their competitor and former regional monopoly SBC started accepting credit cards. But PSE&G, of course, has little to worry about.

I was one of those customers requesting to allow credit card payments for the past two years. I certainly did not expect to see such a "creative" solution. I suggest ending this "pilot" program ASAP to prevent more embarrassment and unpleasant comments.

I would also like to point out that in violation of the FTC regulations, PSE&G does not provide its customers with a way to opt out of its promotional materials. As an environmentally concerned individual, I have requested to stop inserting fliers, brochures and other papers into my monthly billing statement over two years ago, but apparently, it is still not an option. It is certainly easier to continue doing business "as always", but perhaps it is time to show some concern for the future generations whose oxygen supply we are carelessly wasting every time we use a piece of paper needlessly.

seems just like the service fees charged by paying parking tickets online with a credit card. I think they are allowed as independant agencies and do not violate tos of credit card sales merchants since you are not paying pseg directly.

I use NJ natural gas and pay online monthly through my checking acct. i have noticed the last few times that they have a pop up survey asking about the interest in paying via cc and if you are willing to pay a fee for that convenience so it looks like they may be heading the same direction. The do not have a fee now for ach transfers though.

I pay my PSE&G bill with direct debit from my checking account...they don't charge a fee for that.

Since it seems you are on a laudable crusade, if you really want to bust their chops, tell them you plan on complaining about the fee to the Board of Public Utilities.

PSE&G can't send a Checkfree e-bill either, unlike all of my other monthly payees.

It's obvious that Speedpay is a temporary bandaid until they get their bass-ackwards billing system in gear, and only a fool would accept a $5.95 convenience fee.

Auto-debit from your bank account is not recommended for any variable monthly bills. What if they read the meter wrong or the price of gas spikes and they auto-debit you for $3,000? I'd rather keep control by entering a manual Checkfree payment each month.

DWJoe said: [Q]Auto-debit from your bank account is not recommended for any variable monthly bills. What if they read the meter wrong or the price of gas spikes and they auto-debit you for $3,000? I'd rather keep control by entering a manual Checkfree payment each month.Depends on the bank and how the auto-debit is set up. With BofA, you can set up your incoming "e-bills" to be autopayed only up to a limit, otherwise you have to manually approve them. For example, I set up my electric bill (ComEd) to be autopaid only if the bill is $100 or less.

But that is a debit initiated by your bank, as opposed to initiated by the utility. I would agree that there is more risk in having the utility initiate the debit, unless you receive the bill with sufficient lead time to challenge any strange balances.

clemente21 said: [Q]Depends on the bank and how the auto-debit is set up. With BofA, you can set up your incoming "e-bills" to be autopayed only up to a limit, otherwise you have to manually approve them. For example, I set up my electric bill (ComEd) to be autopaid only if the bill is $100 or less.
I know, and I'd like to be able to do the same. Unfortunately, PSE&G doesn't send Checkfree e-bills.

[Q]But that is a debit initiated by your bank, as opposed to initiated by the utility. I would agree that there is more risk in having the utility initiate the debit, unless you receive the bill with sufficient lead time to challenge any strange balances.
Automatic debit is old, old technology, and usually requires a complete billing cycle to turn on and off. I'm extremely leery about giving a bureaucratic utility with antiquated billing systems authorization to charge my bank account for an amount determined solely by them.

Notice... most of the utilities like landline residential phone, electric, gas, etc. which have a monopoly on services don't have to beg for your payments (they'll just shut you off or offer high priced credit protection insurance). That is not the core of their business and any expenses to accomodate our bill paying via credit card will have to be tacked on to any increases they seek from the Public Utilities Commission during rate approval process. I think you are wasting your time, Eugene, trying to convert the 'business'. <img src="i/expressions/face-icon-small-wink.gif" border=0>

curbcrusher said: [Q]With a member name of "EugeneV" I never suspected your real name to be "Deborah K. McGrane".

Duh

EugeneV said: [Q]
ConEd somehow managed to provide online CC payments back in the 90's, when it was still known as Brooklyn Union Gas. As soon as AT&T was allowed to offer local telephone service, their competitor and former regional monopoly SBC started accepting credit cards. But PSE&G, of course, has little to worry about.


EugeneV, I have never seen ConEd accepting CC payments. Is ConEd still doing it? Can you point me to a link?

Thanks.

dmitri, my mistake. My Brooklyn memories are fading... <img src="i/expressions/face-icon-small-smile.gif" border=0>

slc39 said: [Q]Isn't it illegal to charge extra fees to cover the cost? Maybe you should forward that email to Visa/Mastercard and let them decide if it's in violation of their TOS.
Yeah, report the IRS while your at it <img src="i/expressions/face-icon-small-disgusted.gif" border=0>

EugeneV, I am afraid you are looking at this opportunity the wrong way.

You have to first get youself mired in debt. Then, don't pay your utility, and wait for services to be shut off.
THEN, all you have to do is pay $5.95, and the problem is *taken care of*.

Just because you are not in a position to take advantage of this deal, doesn't mean other people won't.

i use mbna bill pay to pay PSE&G ... i don't get any reward points or anything, but still get the convenience of paying through CC, as well as 25 day float.

prozario, that's probably what I will do, too, although it is less convenient than having them charge CC automatically (and doesn't earn points).

EricGo, I thought the same thing the moment I saw their offer. I thought right away, "what low lives!" Charge a fee for the "convenience" of getting people into even more debt (as I'm sure the only ones using it are people with huge bills overdue). Oh well, that explains the fee, too - most users are probably on their way to bankruptcy anyway, so who cares, through another six bucks in there...

Could be worse, at least they offer automatic debit. I have Comcast for my local phone service (formerly AT&T Broadphone Digital Phone). The ONLY way to pay is to write a check and mail it!

I go ahead and pay 3 months in advance so I don't have the hassle of writing a check every freakin' month.

What merchant account provider would you recommend to PSE&G? They are currently using a third party processor (SpeedPay), charging $5.95 "convenience" fee. I believe they should be able to get a very low rate if they handle the cards themselves, due to lower risk (since all customers' identities and addresses are known). Perhaps they should deal with Visa/MC/AM_EX/Discover directly?

I exchanged some angry letters with them, and they claim that the rate they'll be charged are 2-4%. I think they should do better than that. They also promise free online bill pay by the end of the year, but frankly I don't believe them.

They also said that they could easily provide CheckFree e-Bill, but only if they stop paper statements, and there wasn't enough interest. I am wondering if I should post this in a few dozen forums, so that they'll get a better idea of what the public wants.

(Also posted here.)

based on my experience, if you don't pay bills month to month with PSE&G, you don't get any finance charge. so perhaps you can pay every two months - or make estimated payment ahead of time, thus reducing the fee.

Are you getting some sort of wage for working on thier behalf?

EugeneV said: [Q]What merchant account provider would you recommend to PSE&G? They are currently using a third party processor (SpeedPay), charging $5.95 "convenience" fee. I believe they should be able to get a very low rate if they handle the cards themselves, due to lower risk (since all customers' identities and addresses are known). Perhaps they should deal with Visa/MC/AM_EX/Discover directly?

I exchanged some angry letters with them, and they claim that the rate they'll be charged are 2-4%. I think they should do better than that. They also promise free online bill pay by the end of the year, but frankly I don't believe them.

They also said that they could easily provide CheckFree e-Bill, but only if they stop paper statements, and there wasn't enough interest. I am wondering if I should post this in a few dozen forums, so that they'll get a better idea of what the public wants.

(Also posted here.)

Well... look at it this way. If they decided to actually accept the credit cards themselves, then they would not be able to charge you a "fee" as you said before. Then they would be out 1-2% of the bill. That would essentially require them to raise their rates for everybody by the same percentage. So anybody paying with checks (or cash equiv) is getting a rate hike, while anybody using a rewards card comes out almost even.

It's off topic, but

loserguy said: [Q]Could be worse, at least they offer automatic debit. I have Comcast for my local phone service (formerly AT&T Broadphone Digital Phone). The ONLY way to pay is to write a check and mail it!

I used to have Comcast Digital Phone in NH, and you can pay by phone using your CC. Not as convenient as online/automatic, but at least an option.

jazzhands said: [Q]Are you getting some sort of wage for working on thier behalf?

No, just oxygen <img src="i/expressions/face-icon-small-smile.gif" border=0>

I don't even need it; I currently have free bill pay from three banks. But I don't want them to access my checking account directly and I don't want to get their mail - tons of brochures with every bill. I think many thousands will appreciate CC payments and CheckFree e-Bills.



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